KEY TAKEAWAYS

  • A business name can be changed on either a current year tax return or by sending written notice to the IRS. 

  • If a business changes their name, they may also need to update the EIN.

  • After the business’s name is changed all legal documents should be retained.

As your business evolves, you may determine that you need to undergo a name change. Changing your business name with the Internal Revenue Service (IRS) can be done in one of two ways. Corporations and LLCs can check the name change box while filing their annual tax return with the Internal Revenue Service (IRS). You can also notify the IRS through a name-change letter if the change needs to be quicker or if you’ve never filed an IRS return for the business.

Reasons to Change Your Business Name with the IRS

If you have changed your business name,  you will also need to update your business name with the IRS. You’ll need to change your name with the IRS to ensure tax compliance by keeping all documents accurate and legally compliant. Failure to update your business name with the IRS can result in legal complications, including fines or penalties.
 

In short, your EIN and business name must match in order for your return to be processed. Additionally, your business name maintains a professional image, reflecting reliability to partners, customers, and the IRS.
 

If you are changing your business name and address, you will need to notify the IRS and file IRS Form 8822-B.

Steps to Change Your Business Name with the IRS

  1. Find and research a new name, ensuring it will not infringe on any trademarks.

  2. Notify the  Secretary of State for your state about the name change.

  3. Get the name changed in your licenses and permits.

  4. Inform the IRS about the name change. In some cases, you may be required to obtain a new EIN.

  5. Update the new name in your business documents.

  6. Communicate the name change to your bankers, vendors, customers, and all other concerned parties.

Business Name Change vs DBA

Before filing a name change with your state and the IRS and informing your bank, creditors, and others about the change, you should first make sure that you don’t just need a simple Doing Business As (DBA) filing.

Every registered company has both a legal name and a trade name. The legal name may be something like “Awesome Business LLC,” but that entity then owns a brand called “Red Shoes.” Awesome Business LLC may be confusing to customers, so by filing a DBA the company can sign receipts and invoices as “Awesome Business LLC dba Red Shoes.”

Here is how to decide whether you need a business name change or to simply file a DBA:

  • If you are changing your whole business and your old name no longer applies, changing the business name is a clean option.

  • If you’ve rebranded your product but the old business name still applies, filing a DBA may make the most sense.

Assuming you’ve decided that changing your business name is the right move, here are the steps to do so with the IRS.

How to Notify the IRS of Your Business Name Change

Once you have changed your business, you will also need to update the name with the IRS. You can do this by following the steps below:

  1. Update your business name on your current year tax return.

  2. If you have already filed your current year tax return, you can send a signed letter to the IRS.

  3. Include Necessary Documents: Attach a copy of the state-approved name change document (Certificate of Amendment) with your letter.

  4. Sign the Letter: Ensure the letter is signed by an authorized officer of the company.

  5. Wait for Confirmation: The IRS typically takes six weeks to process the name change. Ensure you receive confirmation before assuming the change is complete.

Sample Business Name Change Letter to the IRS

One way to notify the IRS about your business’s name change is by mailing a letter to the IRS. This process is typically followed when a current year’s return has already been filed. Let’s take a look a sample letter that can be sent to the IRS to notify them of your business’s name change below:



 

Dear Internal Revenue Representative, 

The purpose of this letter is to inform you that [Old Name of Entity] (EIN #______) has recently updated its name to [New Name of Entity] with the Secretary of State for (include your state) as of [Date]. I would greatly appreciate it if you could update your records to reflect our new name.

Additionally, if it’s possible to issue a new EIN verification letter which reflects the new business name.

Thank you so much for your assistance and support with this update. If you need any more information or have any questions, feel free to reach out.


 

Signature: ______________

Printed Name: __________

Title: _________________

Date__________________

When to Apply for a New EIN

  • Usually, when simply changing your business’s name, you will not be required to change the EIN as long as the ownership or business structure has not changed as well.

  • Other changes that often come with a business name change, such as change of ownership, bringing on partners, incorporation, you become a subsidiary of a bigger company, or changing the business classification at all such as from a Corporation to an LLC will require an EIN change.

  • A full list of times you need to change your EIN along with a business change can be found here on the IRS’s website.

  • If your business meets the requirements for changing the EIN, you must both apply for a new EIN and cancel the account for the existing one.

  • EINs are unique to the business for which they were issued, and a canceled number will never be reused for another business.

  • To apply for a new EIN, go here and follow the steps required.

  • To cancel an EIN, write to the IRS at "Internal Revenue Service, Cincinnati, Ohio 45999" and give the reason for why you want to close the account. Be sure to include the complete legal name of your business, the EIN, and the business address.

How to Handle Business Name Changes for Different Entity Types 

The process to change your business name depends on your entity type. Below is a guide to making the change, based on your business structure:

Entity Type

How to Change Business Name 

Sole Proprietorship

Send a letter to the IRS at the address where you filed your last tax return. Inform them of your name change. To change the address, the IRS requires a signed letter. It must be signed by the business owner or an authorized representative.


 

LLC

For LLCs, use the same rules listed for sole proprietors.

Partnerships

For partnerships, if you are filing a current year Form 1065, mark the appropriate name change box on the form: Page 1, Line G, Box 3.

If you have filed your return for the current year, send the IRS a letter to the address where you filed it to inform us of the name change. The letter must be signed by a partner of the business. 


 

Corporation

For corporate officers, if you are filing a current year return, mark the appropriate name change box of the Form 1120 type you are using:

  • Form 1120: Page 1, Line E, Box 3

  • Form 1120-S: Page 1, Line H, Box 2

If you have filed your return for the current year, send the IRS a letter to the address where you filed it. It must inform us of the name change. A corporate officer must sign the letter.


 

What to Do After Your Business Name Change

After you have updated your business name, be sure to do the following:

Update Legal Documents

Change the business name on contracts and other legal documents.

Update Marketing Materials:

Revise your website, business cards, signage, and ads to reflect the new name.

Notify Financial Institutions

Update your bank accounts and credit cards with the new business name. Also, update your loan documents

Update Online Profiles

Make sure your business name is current on all online platforms, including social media, Google My Business, and review sites.

Common Mistakes to Avoid When Changing Your Business Name with the IRS

When changing your business name, avoid the following common mistakes to ensure your business transition is a success.

Mistake

Explanation

Missing Documentation 

When changing the name of your business, ensure that you have all the necessary documents. You’ll often need the Certificate of Amendment, as well as an Amended Articles of Incorporation/ Organization. You may also need to amend your business bylaws.

Failing to Apply for an Updated EIN

Depending on your entity type, you may need to also request a new EIN and/or an updated EIN letter. Be sure to complete this step to avoid future tax and legal complications. 

Providing Incomplete Information to the IRS

Omitting necessary details like the old business name, EIN, or the authorized officer’s signature in your letter to the IRS can lead to the  IRS rejecting your request.

Failure to Notify Banks and Creditors

Forgetting to inform banks, vendors, and other important 

Final Steps: Ensure Your IRS Business Name Change is Successful

After submitting your business name change to the IRS, monitor the process. Stay in touch with the IRS to ensure you have done it correctly. If you have also updated your address, be sure to keep track of IRS Form 8822-B. You should also keep copies of all relevant documents, and ensure you notify other necessary entities like your bank, state agencies, and business partners of the name change to avoid any future issues. If you help and are looking for Legal Assistance with Your IRS Business Name Change? Get Expert Help with UpCounsel Today.

Frequently Asked Questions (FAQs)

Do I need a new EIN if I change my business name?

In most cases, you won’t need to change your EIN when updating your business name, as long as the ownership or business structure remains the same.

How long does it take the IRS to process a business name change?

On average, it takes the IRS approximately 6 weeks to process your business name change. You should contact the IRS if you do not hear from them within this timeframe.