5 Things to Consider When Getting a Federal EIN
Get an EIN: An Essential Step for Businesses2 min read
When forming a business or making changes to an existing business, one of the most important steps that a business owner needs to take is getting a Federal Employer Identification Number (EIN). The EIN is used to identify a business to the Internal Revenue Service and other government agencies and to facilitate tax-related matters. If you’re in Chicago and are looking for legal assistance to help you with obtaining and using an EIN, you should consider these five key things before you do.
The first thing to consider when getting a Federal EIN is the type of entity you own. Depending on the type of entity your business is, there might be different regulations and requirements for acquiring an EIN. For instance, corporations must have an EIN, while sole proprietors might not have to have one. Knowing the specifics of your business type is the key to understanding whether you need an EIN.
The second thing to consider is the way in which you will use your EIN. The Internal Revenue Service uses EINs to track the income and related tax payments of businesses. If you make any tax payments, such as income tax or payroll taxes, you will need an EIN. Using an EIN to open a bank account or to hire employees also requires one.
The third thing you should consider is the availability of EINs through other methods. Typically, you will need to get an EIN through the Internal Revenue Service, but there are other methods of getting an EIN. For instance, some businesses are able to get an EIN from a state agency. Before applying for an EIN, you should research all of your options to see if you can save yourself the time and money associated with an IRS application.
The fourth thing to consider is whether you need legal assistance when getting an EIN. It is possible to get an EIN without the help of a lawyer, but certain circumstances might require one. For instance, if you’re forming a complex entity, such as a corporation, a lawyer might be able to help you navigate the intricacies of the law. Working with a lawyer who has experience in federal tax issues might be helpful.
Lastly, you should consider the cost of obtaining an EIN. An EIN is free of charge from the Internal Revenue Service, but you will need to make sure that you are using a legitimate source for your application. Working with a lawyer to get an EIN can be costly, so you should make sure that you weigh the cost of legal help against the savings you might have otherwise by going through the IRS.
An EIN is an important identification tool and can be used to help you start and operate your business more efficiently. If you’re in Chicago looking for legal assistance to help you get an EIN, you should consider the type of entity you have, the way in which you’ll use it, different sources for getting an EIN, the cost, and whether you need to hire a lawyer. Once you’ve taken these steps, you’ll be able to get an EIN and start taking your business to the next level.
Topics:
