LLC Number: Everything You Need to Know
An LLC number, Federal Tax ID Number, or Employer Identification Number (EIN) is assigned to a Limited Liability Company or LLC and its one Responsible Party, whether the LLC has a single owner or multiple ones.3 min read
An LLC number, Federal Tax ID Number, or Employer Identification Number (EIN) is assigned to a Limited Liability Company or LLC and its one Responsible Party, whether the LLC has a single owner or multiple ones.
The EIN is issued by the IRS or Internal Revenue Service to offer administrative taxation options that distinguish business entities from partnerships, Limited Liability Companies, sole proprietors, and corporations. The LLC number is nine digits long and exclusively identifies a single firm.
As an LLC, your business members have no responsibility for company debts and other liabilities. It protects your family's assets and allows you the opportunity to declare the profits of your company on your income tax returns. The Responsible Party is the only member of your Limited Liability Company who has a certain level of direct or indirect control over assets or funds.
Even when an LLC has more than one owner or multiple members, the only individual who can obtain the EIN on behalf of the company is the Responsible Party. Only this member-elected person has the authority to direct or otherwise manage the entity and the disposition of the LLC's resources and assets.
When Do You Need to Get an LLC Number?
The following scenarios describe the instances in which it is necessary for you to obtain an EIN for your LLC:
- Your Limited Liability Company has multiple members.
- You have hired part-time or full-time workers.
- You currently have a sole proprietor LLC established and are about to hire the first employee.
If your LLC is a single proprietor firm having no workers employed, for tax purposes, you can continue using your Social Security Number for tax filings. In this case, although you are not required to have an LLC number, it is worth mentioning that having one is a safeguard against identity theft.
Conducting business as a sole proprietor LLC and using a Social Security Number puts you at risk because you are regularly providing your personal information to vendors and clients on behalf of the company.
Aside from helping you to avoid identity issues, there are other benefits to obtaining an EIN. One significant advantage is the credentialing that a federal Tax ID provides by allowing you to open a bank account, apply for business permits, or apply for a credit card in the name of the company.
Keep in mind that the EIN serves a function for taxation only and should not be used for other activities, such as lotteries, tax lien auction or sales, and so forth.
Your Responsible Party is the designated requester for the Federal Tax ID Number. Whoever gets elected for this role must have an existing Taxpayer Identification Number, which could be a Social Security Number (SSN), Individual Taxpayer Identification Number (ITIN), or Employer Identification Number (EIN).
The authorized applicant on behalf of the LLC must answer complex questions, so he or she should have the answers prepared beforehand and also possess enough general information about the business and the owners to accurately provide details.
The Responsible Party needs to know all, but not limited to, the following details about the LLC:
- Company's type of legal structure.
- The number of LLC members owning the company.
- State of business' physical location.
- The specific reason for applying to get an EIN, which could be getting ready to hire employees or forming a new business.
How to Get a Federal Tax ID Number Online
The online application for the LLC number is open from 7 a.m. to 10 p.m. PST during the week. The average time to process is 30 minutes. The system will not allow you to save the application and return at a later time. You must finish applying in one session, as any information entered will expire after being inactive for 15 minutes, and you must start again from the beginning when you are ready to complete it.
Once everything entered in the online application has received its proper validation, the EIN and confirmation notice is provided immediately for downloading, saving, and printing during the open hours for online processing.
There is no longer any phone support available for EIN applicants, but there are alternative services available 24/7 for obtaining the Tax ID Number after hours.
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