W W W. U S T a x A i d. c o m

Transcription

1 HOW TO GET A FEDERAL TAX ID NUMBER FROM THE IRS There are three ways to get your LLC s Tax ID Number. One is by completing a Form SS- 4 and either faxing or mailing it in. That s the slow way. You ll wait a week or more for your number to be faxed back, and you could wait months for the mail. The second way is to call the IRS, at The hours of operation are 7:00 a.m. to 10:00 p.m. local time (Pacific time for Alaska and Hawaii). Only a Manager or Member of the LLC can call in. You will need to have the Form SS- 4 completed before calling in, and will answer the same questions verbally during the telephone interview. At the end of the interview the IRS agent will give you a Tax ID Number, and will follow up with a written confirmation that will come by mail. The third way is by stepping through the online application available at the IRS website That s the fastest way. You receive your number at the end of the online application. Did You Know A Tax ID number is a 9-digit number shown as The first two digits will change depending on how and where the application was made. Internet applications are given 2-digit prefixes of 20, 26 or 27. Whichever method you use you ll need to have some information handy, first. Let s step through the actual paper form, and then show you how it translates into the online application. W W W. U S T a x A i d. c o m 2010, Smart Money, LLC. All rights reserved. Page 1 of 24

2 Step One Questions 1 through 8c Question 1: Write down the name you used when you incorporated your LLC. Make sure you list the full name, i.e., Jones Auctions, LLC, and not just Jones Auctions. Question 2: If you have applied for a d/b/a you can write this name in here. But as you ll be filing tax returns in the name of the LLC, you generally don t need to complete this. Question 3: Not applicable for your business (unless it s owned by a Trust). Question 4a and 4b: Use the address where you want the IRS to mail tax- related material. It doesn t have to be your home address, but there s nothing wrong with using your home address here. Question 5a and 5b: If you have a mailing address (i.e., a PO Box) and you want to also put a street address on the record, complete this section. Question 6: Write down the county and state where the business is located. That s typically going to be the county and state where you live. Question 7a and 7b: Write in your name and your SSN. The IRS only uses your SSN as a way to identify who is making the application. 2010, Smart Money, LLC. All rights reserved. Page 2 of 24

3 Question 8a, 8b and 8c: Answer yes to Questions 8a and 8c. Write down the number of owners of the LLC at Question 8b. If you and your spouse are both owners, you can still write in 2 members here, even if you want the LLC to be taxed as Single Member Disregarded. Step Two Questions 9 through 10 Question 9a: You have three options here, depending on whether you want partnership taxation, Single Member Disregarded taxation, or S Corporation taxation. If you want the LLC to be taxed as a partnership, tick the Partnership box. If you want your LLC to be taxed as a Single Member Disregarded, tick the Other box, and write in Single Member Disregarded in the space next to it. If you want your LLC to be taxed as an S Corporation, tick the Other box, and write in S Corporation in the space next to it. Question 9b: As you have created an LLC, you don t need to complete these sections. Not sure what tax classification to choose? Read the Business Structure Basics handouts to go through your options Question 10: Select the Started new Business box, and in the space next to it, write in either LLC- Partnership, LLC Disregarded, or LLC S Corporation. 2010, Smart Money, LLC. All rights reserved. Page 3 of 24

4 Step Three Questions 11 through 17 Question 11: Write in the date your LLC was incorporated. You ll find that information on the filed Articles of Organization. Question 12: Write down December in this space. December 31 st is the default year- end date for all LLCs, unless the LLC has chosen to be taxed as a C Corporation. Question 13: Leave these sections blank. You don t need to specify employees yet, and it will prevent you from using the online application if you enter anything into these three categories. Question 14: Leave this blank for the time being. You won t really have an idea of your employment tax liability at this point (if any remember if you ve elected to be taxed as a partnership or Single Member Disregarded you won t have any employment tax you ll have self- employment tax, which is reported differently). Question 15: Leave this blank. Question 16: Tick the Other box here, and write in online auctions in the space next to it. Question 17: If you know what you ll be doing with your LLC business you can write that down here. If you aren t sure, or want room to grow and change, ask your incorporator or CPA/tax advisor. 2010, Smart Money, LLC. All rights reserved. Page 4 of 24

5 Step Four Questions 18 through end Question 18: Because your LLC is brand new, you will select the No box. The IRS isn t asking if you personally have ever applied for a Tax ID number for another business. Third Party Designee: Leave this blank. You are making this application personally. Signature Block: Print your name above, along with your title. You will be signing as either the Manager or the Member of your LLC. Sign your name, write in the date, and provide your phone and fax numbers. You must provide a fax number if you want the IRS to fax back your completed application with Tax ID number supplied. Step Five How to File with the IRS 1. By Telephone: The hours of operation are 7:00 a.m. to 10:00 p.m. local time (Pacific time for Alaska and Hawaii) 2. By Mail: Internal Revenue Service, EIN Operation, Cincinnati, OH By Fax: Via the IRS Online Application, found at or go directly to the application here: W W W. U S T a x A i d. c o m 2010, Smart Money, LLC. All rights reserved. Page 5 of 24

6 WALKTHROUGH FOR THE ONLINE TAX ID APPLICATION Let s step through the screens you ll see in the online process: Screen 1: Scroll down, and click the APPLY ONLINE NOW link 2010, Smart Money, LLC. All rights reserved. Page 6 of 24

7 Screen 2: Information Screen Click Begin Application button to proceed. Screen 3: Select Limited Liability Company (LLC) and click Continue to go to the next screen 2010, Smart Money, LLC. All rights reserved. Page 7 of 24

8 Screen 4: Insert the number of owners in the LLC either 1 or 2 (or more, as appropriate) and then select your State. Click Continue to go to the next screen Depending on your selections in Screen 4, the next few screens will change. We have shown you 3 possible options Option 1 Single Member LLC Screen 5.1.1: Enter 1 in the Number of Members, scroll down to select your state and click Continue to go to the next screen. 2010, Smart Money, LLC. All rights reserved. Page 8 of 24

9 Screen 5.1.2: Information screen only. Click Continue to go to the next screen Option 2 Married Couple Electing Single Member Status Screen 5.2.1: Enter 2 in the Number of Members, scroll down to select your state and click Continue to go to the next screen. 2010, Smart Money, LLC. All rights reserved. Page 9 of 24

10 Screen 5.2.2: Select the Yes option. Click Continue to go to the next screen. Screen 5.2.3: Make the single- member election to be classified as a Single Member LLC. (If you want to elect partnership taxation, elect to be classified as a Multi- Member LLC instead. Click continue to go to the next screen. W W W. U S T a x A i d. c o m 2010, Smart Money, LLC. All rights reserved. Page 10 of 24

11 Screen 5.2.4: If you have elected Single- Member tax status you will see this screen. If you have elected Partnership tax status you will see the screen at Click Continue to go to the next screen Option 3 2+ Owner LLC Electing Partnership Taxation Screen 5.3.1: Enter 2 in the Number of Members, scroll down to select your state and click Continue to go to the next screen. 2010, Smart Money, LLC. All rights reserved. Page 11 of 24

12 Screen 5.3.2: If you are husband/wife you will see the screen at If you are not husband/wife you will see this screen. Select No and click Continue to go to the next screen Screen 5.3.3: Information Screen. Click Continue to go to the next screen The Options section is done. No matter what you selected, from here to the end you will all see the same screens 2010, Smart Money, LLC. All rights reserved. Page 12 of 24

13 Screen 6: Select the Started a New Business option and click Continue to go to the next screen. Screen 7: Select the Individual option and click Continue to go to the next screen. 2010, Smart Money, LLC. All rights reserved. Page 13 of 24

14 Screen 8: Complete the information required. Enter your name, SSN and select the option I am one of the owners, members or the managing member of this LLC. Click Continue to go to the next screen. Screen 9: Type in the LLC s physical address (typically your home). If you have a PO Box that you want to use as the mailing address, select the Do you have an address different option. A drop- down window will appear allowing you to type in the mailing address. Click Continue to go to the next screen. 2010, Smart Money, LLC. All rights reserved. Page 14 of 24

15 Screen 10: Type in the full name of your LLC, as incorporated. Complete the other information as shown the county and state where your LLC was formed, and the month/year of formation. Click Continue to go to the next screen. Screen 11: Select NO to all entries on this page. Click Continue to go to the next screen W W W. U S T a x A i d. c o m 2010, Smart Money, LLC. All rights reserved. Page 15 of 24

16 Screen 12: Select the appropriate button and click Continue to go to the next screen. If you are a consultant or provide some other form of service, select Other. If you are an online marketer, or sell goods over the Internet, select Retail. The next screen will change, depending on your selection. 2010, Smart Money, LLC. All rights reserved. Page 16 of 24

17 Screen 13: If you selected Real Estate, the next screen will show you several options. Click the appropriate one and click Continue to go to the next screen. 2010, Smart Money, LLC. All rights reserved. Page 17 of 24

18 Screen 14: If you selected Retail, the next screen will show you several options. Select the appropriate one and click Continue to go to the next screen. Screen 14: If you select Other, you will have several options to choose from on the next screen. Select the appropriate one and click Continue to go to the next screen. 2010, Smart Money, LLC. All rights reserved. Page 18 of 24

19 Screen 15: If you selected either Consulting or Other, the next screen will ask you to provide some details on what the service or consulting activities consist of. Keep it brief! Click Continue to go to the next screen. Screen 15: Make your selection. If you have a way to print off and save PDF files, select the first option. Click Continue to go to the next screen. 2010, Smart Money, LLC. All rights reserved. Page 19 of 24

20 Screen 15: Review your information to make sure everything is correct. Click Submit to proceed. If there are any mistakes, go back to Screen 1 and start the application over again. 2010, Smart Money, LLC. All rights reserved. Page 20 of 24

21 Screen 16: If all goes well, you will see a screen like the following, with your LLC s Tax ID number listed. PRINT THIS SCREEN BEFORE YOU CLOSE YOUR BROWSER!! Then, click the CLICK HERE for Your EIN Confirmation Letter link to see your Tax ID Confirmation letter. You re done! You can come back to this screen and click the Continue button to read more about your EIN, or you can close your browser window. 2010, Smart Money, LLC. All rights reserved. Page 21 of 24

22 Page 1 of IRS Confirmation Letter. PRINT THIS DOCUMENT BEFORE YOU CLOSE YOUR BROWSER. If you have the ability to save a PDF file, SAVE THIS DOCUMENT BEFORE CLOSING YOUR BROWSER. (Note that this example is from an S Corporation filing. Your letter will give you a form choice of partnership (1065) or Single Member disregarded). 2010, Smart Money, LLC. All rights reserved. Page 22 of 24

23 Page 2 of IRS Confirmation letter. PRINT THIS DOCUMENT BEFORE YOU CLOSE YOUR BROWSER. If you have the ability to save a PDF file, SAVE THIS DOCUMENT BEFORE CLOSING YOUR BROWSER W W W. U S T a x A i d. c o m 2010, Smart Money, LLC. All rights reserved. Page 23 of 24

24 WHAT HAPPENS IF IT DOESN T WORK? Occasionally the online application won t work. You will see an exception code and a number to call the IRS. What s usually happened is that your company name is the same or similar to another company s name in a different state. The IRS just wants to confirm that there is no connection between the two companies. If this happens to you, prepare Form SS- 4 and call the IRS. The IRS agent will step through the Form SS- 4 questions with you and take down your answers over the phone. They may ask you to fax in a copy of the completed SS- 4. Then, at the completion of the phone interview, you will be given your 9- digit Tax ID Number. 2010, Smart Money, LLC. All rights reserved. Page 24 of 24