Wednesday, February 21, 2018

When Should One Plan on Getting an EIN for Their Business?


Most businesses need to get an employer identification number, or EIN, from the IRS. It is important to do so at the right time so that you do not experience any slowdowns in starting your business. You do need to have a few key documents before you apply for your EIN, so it is important to know the right order for obtaining your necessary business documents.

Necessary Documentation

Before you apply for your EIN, you need to have the following information:

     Business name
     Official address

Although it is best to already have your business entity filed, you can set up the legal entity after you have your EIN. However, you do not want to wait too long before you file your entity documentation, whether as a sole proprietor, partnership, LLC or corporation.

The Best Time to Get an EIN  

Applying for an EIN should be one of the first tasks you do. You generally need to have this number before you apply for your bank accounts, credit cards, and other financial documents, including small business loans. You want to have your financials ready before you start your business so you can receive and remit payments. It is also important to have this number for certain contracts you might have with your clients or customers.

You can choose to get your EIN first thing before you set up the rest of your business, including registering the business entity and getting all necessary permits. Alternatively, you can set up your business structure and then get your EIN. Either way, this should be one of the first actions you take during the initial set up of your business. You will need it before you hire any employees, as well as any contract workers who you pay more than $600 for their services.

Even if your business structure does not need an EIN, you should still consider getting one to make certain tasks easier. Learn more about getting an EIN number in Louisiana. Applied but still haven't received your number? Check EIN status at this link. Contact IRS-EIN-Tax-ID Filing Service to learn more about EINs.

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