For many, tax season is often stressful and demanding as identifying and filing the correct form can be crucial to avoiding penalties. If you happen to be a business owner, you may need to file for an EIN- which is essentially a business tax ID. In case you aren’t sure, here are a few tips to help you decide:
Independent Contractors: If you consider yourself an independent contractor, the answer to whether or not you can file for an EIN depends on several factors. Having employees, or wanting to become incorporated, are some of the reasons that you could file for an EIN. For instance, if you are running a graphic design business and decide to hire an extra designer to help with work overflow, you would technically need an EIN.
Corporations and Partners: Partnerships and corporations do need an EIN under the law. Even if your entire company consists of yourself and a friend who is an equal partner, you would still need to file your taxes under a corporate EIN. Any non-profit organizations, real estate mortgage investment conduits, and farmer’s cooperatives, will need to file for an EIN as well.
How To Get an EIN: The fastest and easiest way to get your IRS EIN Tax ID is to do so online. For instance, you can verify your eligibility for IRS-EIN-Tax-ID.com directly on the website, get your EIN instantly, and even check your tax ID status in the future. Most websites will also offer helpful tips and answers to other commonly asked questions. In addition to obtaining an EIN online, you have the option of faxing or mailing the EIN application form to the IRS, though you should expect to wait up to two weeks to get your EIN using either method.
Taking the time to do your research will help you avoid unnecessary hassle, and potential fines in the future. Make sure to apply for the EIN if your company fits the requirements.