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When Should You Obtain A Tax ID for you LLC

John Bowman

Retired
Staff member
NACBI Member
Is your LLC compliant? Check out my quick tip.


National Association of Commercial Building Inspectors & Thermographers™



Contributor: John Bowman This tip sheet is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of the author, not NACBI, and have not been evaluated by NACBI for accuracy, completeness, or changes in the law. Users of this tip sheet are cautioned to consult with their own professional legal or accounting representatives.

When Should I Obtain a Tax ID Number for an LLC in the U.S.?

When you formed your limitedliability inspection company, there were several things you accomplished to ensure you were in compliance with U.S. state and federal tax laws. Carefully understanding all of the regulations will help you meet your tax obligations as you move forward and grow with your LLC company.

Determine If You Need a Tax Number for LLC?

The IRS uses EINs as a quick identification of your business in your tax filings and dealings with the IRS. Employer Identification Numbers are issued for the purpose of tax administration and are not intended for participation in any other activities (e.g., tax lien auction or sales, lotteries, etc.)

If your LLC has more than one member (owner) or has employees (part or full-time) you need to obtain an employer identification number (an EIN, also called tax ID numbers) from the IRS. If you are an existing sole proprietor limited liability company and you are about to hire your first employee, you will need to obtain a federal tax number for that purpose.

If you are a sole proprietor LLC without any employees, you can continue to use your Social Security number for your tax filings if you wish. Be aware though that an EIN can help you avoid identity theft issues that can pop up when you are filling in your Social Security number on forms and giving it out to clients and vendors.
 

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Terry Clayton

Community Post Master
NACBI Member
Thanks for the tip, young man.
 
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