Which Changes Affect Your Employer Identification Number?

Remember when you first started your business? Unless you intended to operate as a sole proprietorship or single member LLC with no employees, one of your first interactions with the IRS was to apply for your employer identification number (EIN). After you submitted the application (Form SS-4), the IRS assigned you a nine-digit number. You shared the number with a bank to open your business account, and you’ve been using it on your income and payroll tax returns ever since.

You probably seldom think about your EIN, since it will generally last the life of your business. That’s true even if your business name changes or you move to a new address or add more locations, such as additional stores.

Your EIN will even survive the sale of your business when the buyer purchases the assets, liabilities, and charters. Also, you can continue to use the same EIN when your “C” corporation elects to become an “S” corporation.

There are situations, such as if you incorporate your partnership or sole proprietorship, when you’ll need to request a new EIN. The same applies when you switch from a corporation to a partnership or sole proprietorship.

In the past, the IRS seldom contacted you about your EIN. However, beginning in January 2014, you’ll have to provide updated information about the name and taxpayer identifying number of the person who controls, manages, or directs your business.

As always, contact us if you have questions.