SOLE PROPRIETOR/INDIVIDUAL | EIN APPLICATION
A Sole Proprietorship is the least complex, inexpensive and most basic type of business, in which just a single individual is entitled to all profits and is also responsible for all the business debts, losses and liabilities. Sole ownership is the most well known business structure for new businesses as a result of its simplicity of arrangement, low record keeping, easy tax preparation and complete control of the business. An Individual or Household employee is anyone that gets paid to provide a domestic service within their employer’s household.
WHAT IS AN EIN NUMBER?
The Employer Identification Number (EIN), also known as the Federal Employer Identification Number (FEIN) or the Federal Tax Identification Number (Tax ID Number), is a unique 9 digit number assigned from the IRS. The digits of an EIN are formatted as follows: XX-XXXXXXX. Entrepreneurs and businesses use an EIN to conduct business activities that would otherwise require a Social Security Number (SSN).
DOES A SOLE PROPRIETOR NEED AN EIN?
- Hire employees
- File for bankruptcy
- Merging or incorporating with another business
- Maintain a Keogh or Solo 401(k) retirement plan
- Open bank accounts (applies to certain banks)
- Obtain local Business Licenses
- Apply for certain licenses or pay state taxes in certain states such as Michigan and Virginia
ALSO, IT IS EXTRA BENEFICIAL FOR SOLE PROPRIETORS TO OBTAIN AN EIN AS:
- It can prevent them from being a victim of identity theft, by not providing their Social Security Number to clients or vendors who they conduct business with.
- It is more presentable to prospective clients and shows credibility
HOW TO GET AN EIN NUMBER FOR A SOLE PROPRIETORSHIP:
Apply now and obtain an Employer Identification Number (EIN) by filling out the EIN Online Application form. It is Easy, Fast and Secure. After you complete the online process you will receive your EIN together with important information within 1-2 business days.