IRS Change of Business Name: Everything You Need to Know
Corporations and LLCs can check the name change box while filing their annual tax return with the IRS.3 min read
2. Steps Involved in Changing Your Business Name
3. Updating Your Business Name Change With the IRS
4. Contents of the Name Change Letter
IRS change of business name can be done in two ways. Corporations and LLCs can check the name change box while filing their annual tax return with the IRS. Alternatively, you can notify the IRS through a name-change letter.
Updating Your Business Name
Sometimes, you may need to change your business name. In order to change the name of a legal business entity like a corporation or an LLC, you must amend the formation document of your business and file it with the state where your business is registered. Doing this would update the records of the secretary of state or other state agency responsible for regulating the corporate affairs. However, your business name linked to your Employer Identification Number (EIN) would still remain the same in the records of the Internal Revenue Service (IRS).
Steps Involved in Changing Your Business Name
- Find and research a new name.
- Notify your secretary of state regarding the name change.
- Get the name changed in your licenses and permits.
- Inform the IRS about the name change. In some cases, you may be required to obtain a new EIN.
- Update the new name in your business documents.
- Communicate the name change to your bankers, vendors, customers, and all other concerned parties.
Updating Your Business Name Change With the IRS
If you happen to change your company's name, you must make sure that the IRS and other concerned parties know about it. Usually, changing your business name does not require you to obtain a new EIN. However, you must get the name updated in your EIN.
There is an easy way to update your business name in the IRS records. You just need to use your new name while filing your annual tax return with the IRS and check the box in the form to indicate that the name of your business has changed. You need not mention the old name in the return.
Sometimes, you may need to change your business name immediately after receiving your EIN. If you need to make a name change before having filed any tax return with the IRS, you should forward your request to the Cincinnati, Ohio, office of the IRS.
C-corporations, S-corporations, and multi-member LLCs that have filed at least one tax return for the business can notify the IRS of the name change by simply checking the name change box while filing your tax return for the current year. Note that this option is not available to single-member LLCs.
However, if you've already filed your tax return for the current year, you need not wait until next year to update your business name in the IRS records. In order to legally effect a name change, LLCs and corporations are required to file a Certificate of Amendment with the state where they were originally formed. You can submit a copy of this document along with a name-change letter to the IRS to update your new name in the IRS records.
Once your new business name is updated with the IRS, you should inform everyone else about your company's name change. You may want to prepare a list of your vendors, bankers, creditors, and other agencies that should be notified about the name change.
Contents of the Name Change Letter
The IRS website does not specify the particulars you should include in the name-change letter, but the omission of essential details can result in the IRS rejecting to update its records. Usually, you should include the following details in the letter:
- Your EIN
- The old name of the business as mentioned in the IRS records
- Complete address of the business as it exists in the IRS records
- The new name of your business
- Date from which the name has been changed
The owner or an authorized officer of the business as per IRS records must sign the letter. It should be accompanied by a state document approving the name change of your business. The name-change letter should clearly state that your business name has changed. Also, don't forget to request for a confirmation from the IRS regarding the updating of the new name in its record.
The IRS typically takes about six weeks to process a name-change letter. If you fail to provide the necessary details in your letter, the IRS may request for additional information, which may further delay the processing.
If you need help with the IRS change of business name, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.