Is an EIN Required for a Single-Member LLC?

An Employer Identification Number (EIN) functions similarly to a Social Security number for your company.

Only single-member LLCs with workers are needed to acquire an EIN, but we will explain why having a free EIN benefits all LLCs below.

When Is an EIN Required for a Single-Member LLC?

If your company is a single-member LLC with workers or excise tax liabilities, you must get an EIN.

If your company is a single-member LLC with no workers or excise tax liabilities, you do not need an EIN.

Even if you are not obliged to get an EIN, we encourage that you do so since having an EIN has various advantages.

EIN\sBenefits

Although not all single-member LLCs are obliged to get an EIN, it is always a good idea to do so.

Obtaining an EIN gives the following advantages:

An EIN may aid in the protection of your corporate veil.

If you establish your company without an EIN or workers and later decide to hire, you will already have an EIN.

Using an EIN instead of your Social Security number (SSN) protects your SSN and reduces the danger of identity theft.

To create a business banking account, most institutions demand an EIN. Another option to keep your personal and work funds separate is to open a company bank account.

The EIN, like your Social Security number, is used by banking and credit agencies to monitor your business’s credit.

Although an EIN is not essential for all business loans, many lenders prefer a firm that has established its business credit via a business bank account and lines of credit linked to the company’s EIN.

What exactly is a Single-Member LLC?

A single member LLC is a company with just one owner that is not taxed separately from their company. A single member LLC, like a sole proprietorship, is taxed as a disregarded entity by default.

Disregarded entities are subject to “pass-through taxes” since the government overlooks them. This implies that all revenues and losses from the company are passed directly to you, the business owner. In turn, you must pay income taxes on your profits using your personal tax return.

How to Obtain a Free EIN for a One-Member LLC

Important: Before applying for an EIN, LLCs must be formally registered and recognized.

Use our free Form an LLC guide to help you register your company. There are also free EIN instructions in the tutorial.

The fastest and easiest approach to get a free EIN is to use the IRS website’s EIN Assistant.

Form SS-4 may also be used to apply for an EIN via fax or mail. If you are submitting via fax, please send the EIN application to (855) 641-6935. If you want to apply by mail, send it to the Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999.

Important information when acquiring an EIN through the IRS website:

The IRS is open from 7 a.m. to 10 p.m. Monday through Friday to receive your EIN.

Only firms headquartered in the United States and its territories are eligible.

A valid Taxpayer Identification Number is required (SSN, ITIN,EIN)

Only one application per day may be made by the entity owner or responsible party.

Your application must be completed in one sitting and cannot be saved.

If the session is not in use for 15 minutes, it will time out.

After completing the form, you will be issued an EIN.

Applications will not be handled if an EIN has already been acquired online.