How to Complete an SS-4 for an LLCBy Roberta Codemo
How to Complete an SS-4 for an LLCBy Roberta Codemo
The Application for Employer Identification Number (Form SS-4) is used to apply for a federal tax ID number, also known as an employer identification number (EIN). This nine-digit number is assigned to entities by the Internal Revenue Service (IRS) for tax-filing and reporting purposes. Even if your business does not have employees, you may need to apply for an EIN under certain circumstances.
A limited liability company (LLC) must have an EIN on record with the IRS before it can file taxes or open a business bank account. Some states also require an LLC to have an EIN. The directions for how to complete an SS-4 for an LLC can be a little tricky, so read them carefully and don't rush through the process.
What Is an LLC?
An LLC is a business entity created by state statute that combines the pass-through taxation benefits of a partnership with the limited liability status of a corporation. An LLC with one owner, also referred to as a member, is a single-member LLC, while an LLC with multiple owners is known as a multimember LLC.
For federal tax purposes, an LLC is treated as either a partnership, if it is multimember, or a disregarded entity, if it is single-member, unless it elects to be treated as a corporation. A single-member LLC files taxes as a sole proprietorship and the LLC's business activities are reported on the owner's federal tax return.
How to Complete Form SS-4
The easiest way to complete IRS Form SS-4 is to do so online. You can also download a hard copy of the form, complete it, and then fax or mail it to the IRS. International applicants can apply by phone. If you don't have access to a computer, you can request that the IRS mail you a copy.
Follow these steps to complete Form SS-4 for an LLC.
1. Identifying Information—Lines 1-7
Fill out the legal name of the LLC as listed in the company's articles of organization. If the LLC does business under another name, fill out the LLC's trade name, or “doing business as" (DBA) name. Next, fill out the mailing address and, if different from the mailing address, the physical address. If it is a foreign LLC, fill out the city, province or state, postal code, and the name of the country. Finally, fill out the legal name of the responsible party—the person that handles the LLC's business affairs—and provide his Social Security number or individual income tax number.
2. LLC Information—Lines 8(a)-8(c)
Provide information about the LLC. Make sure to check the box that indicates that the application is for an LLC and fill in the box indicating the number of members. Note that if the LLC is jointly owned by both spouses of a married couple, they are considered separate members. However, the couple can elect to be treated as a single member if they live in a community property state, including Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. Finally, check the box indicating whether the LLC is organized in the United States.
3. Type of Entity—Lines 9(a)-9(b)
This is where things can get confusing. If the LLC is a multimember LLC, check the partnership box. Should the LLC elect to be taxed as a corporation, check the corporation box, regardless of the number of members it has. If you check the corporation box, you need to enter the name of the state or country where the LLC was incorporated. If you're not sure if the LLC should be taxed as a corporation, check the "Partnership" box if there are two or more members or, if there is only one member, the "Other (specify)" box and write “disregarded entity/sole proprietorship" next to it.
4. Reason for Applying—Line 10
The most common reason for applying for an EIN is starting a new business. If you check this box, enter the type of business that you're starting next to it.
5. Business Information—Lines 11-18
Enter the date that you filed the articles of organization and the closing month of the accounting year, usually December. Enter the number of employees you expect to hire in the next 12 months. If you're unsure, enter zero under “Agricultural," “Household," and “Other." If you enter zero, skip line 14. If you have employees, enter the first date that you paid them. Check the box that best describes the type of business you operate and provide a brief description of what it does. Finally, check “No" if you've never filed for an EIN before; if you have, enter the previous EIN.
6. Third-Party Designee
Complete this section if you want the named individual to receive the EIN or act as a contact person. You need to provide the name, address, and contact numbers and sign the signature area. Check with your designee to see if you should send the application to him or the IRS.
7. Final Steps
Sign and date the application.
Once you're done, don't forget to make a copy for your records.
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