Navigating the legal system can be complex and challenging for businesses in New York or any other state. One of the most frequently asked questions from business owners is “How do I get an EIN?” An employer identification number (EIN) is used to identify a business for internal and external purposes. It is typically required for all businesses that are either sole proprietorships or corporations. An EIN is used to report taxes to the Internal Revenue Service (IRS) and is also necessary for employers who want to hire employees or open financial accounts.

To obtain an EIN, you must first understand the requirements and procedures for doing so and consider the top five things you should keep in mind:

1. Determine if Your Business Entity should Apply for an EIN

The most important thing to consider when applying for an EIN is whether or not your business entity is even eligible to apply for one. If you own a sole proprietorship, LLC, corporation, or other type of business entity, you may need to obtain an EIN in order to open business accounts, hire employees, and pay taxes. If you are a partner in a partnership or the trustee of a trust, you will also need an EIN. An EIN is not required for individuals who are self-employed.

2. Review the IRS Requirements and Regulations for Obtaining an EIN

Before you apply for an EIN, review the IRS requirements and regulations carefully. Depending on your business structure, you may need to provide documentation, such as a registration or license. In addition, you must have an organized plan for the business to qualify for an EIN. Businesses without a plan or structure will be denied an EIN.

3. Consider Retaining Legal Counsel

Hiring a lawyer to provide legal advice or assist in the process of applying for an EIN can be a great way to ensure that everything proceeds smoothly and that you are in full compliance with all applicable rules and regulations. For New York-based businesses, UpCounsel can help connect you with the best attorneys that understand the local regulations. Experienced attorneys on UpCounsel’s network have an average of 14 years of experience, and you can access profiles of our online attorneys to view client ratings and reviews of recent work.

4. Familiarize Yourself with the Applicable Forms

Once you’ve reviewed the requirements and necessary documentation, it’s time to familiarize yourself with the applicable forms. The IRS publishes an “Employer Identification Number Application Form” to facilitate the process of obtaining an EIN. Filling out the form can be daunting, but an experienced attorney can assist you with understanding and completing the form.

5. Consider Engaging an Accountant

Many business owners register with the IRS before hiring an accountant. An accountant can be extremely helpful in understanding the tax implications of owning a business. They can also assist with filing taxes, ensuring your business obtains the maximum deductions allowed by law, and understanding the latest changes to taxes and regulations.

Applying for and obtaining an EIN can be a complicated process, but understanding the requirements and procedures can help make the process a lot easier. Business owners in New York should consider hiring an attorney from UpCounsel and consulting an accountant to ensure they are in full compliance with the IRS rules and regulations.

Topics:

EIN,

Employer Identification Number,

IRS Requirements