When Do I Need a New Tax ID (EIN)? When Do I NOT Need a New EIN?

how to get a business tax id

By Jean Murray. US Business Law / Taxes Expert

Jean Murray has the education and experience to help you become an expert in your small business, and to provide you with information about business legal and tax issues. With an MBA and a PhD in entrepreneurship, she brings almost 30 years of experience and knowledge to these important business subjects.

You can also read more about Jean's current and past work on her About.me page.

DISCLAIMER: I am not a CPA or attorney, and nothing on this site in articles, emails, blog posts, or other communications is intended to be tax or legal advice. The purpose of this site is to provide general information to readers. No claim is made regarding the accuracy or legal status of information on this site. Federal, state, and local laws and regulations change, and every business situation is unique. Readers should not take action on any tax or legal matter without reviewing options with a tax advisor or attorney.

When Do I Need a New Tax ID (EIN)? When Do I NOT Need a New EIN?

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If your business doesn't have employees, there are almost always other circumstances in which you need an EIN.

For example, many banks require businesses to have an EIN in order for loans to be processed, or even for setting up a business bank account. A sole proprietor business without employees may be able to operate without an EIN, but that's about the only circumstance in which an EIN is not needed by a business.

For more complete information on all the circumstances requiring a new EIN, see the IRS website for a listing.

When NOT to Apply for a New EIN

The IRS says you should NOT apply for a new EIN if:

  • You change only the name of your business
  • A partnership or corporation declares bankruptcy
  • A corporation chooses to be taxed as an S corporation
  • You elected on Form 8832 Entity Classification Election. to change the way the entity is taxed, or
  • You change the location or add locations (use Form 8822 - Change of Address )
  • You elect to be taxed as an S corporation .

Source: biztaxlaw.about.com

Category: Taxes

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