EIN and New Business-Timing

[sbrodkey]

I received an EIN for my new business in 2020 BUT I started business activities in 2019 and filing those activities on my tax return. I wanted to use my EIN for my 2019 filings.  Can I do that (use an EIN received in 2020 for 2019 taxes)? Thank.s

[KristinaK]

Yes. 

[Carl]

Yes, you can, and should. Typically, an EIN is obtained for a business is officially "open for business". That's for several reasons.

 - Most banks require the EIN (not the SSN) to open a business account.

 - If an LLC where state registration is required, most states (not all) require you register the business at the state level with a federally issued EIN.

 - Most lenders who are loaning you start up money (such as the SBA) may require the business EIN as part of the loan approval process.

At a minimum, if you don't have a separate account strictly for the business, you should get one. Makes life easier at tax filing time and will literally "save your butt" if the business is ever audited. Mixing business transactions with personal transactions will make an IRS audit an absolute nightmare.

With all the banks out there now-a-days that offer free business checking for small businesses, there's really no reason not to have a separate business account.