EIN vs SSN

[ryan3brown]

This year I opened a new business, a single member LLC.  Anticipating that I would eventually file forms to be taxed as an S-corp, when I requested my EIN in my SS-4 I stated that I would have employees.

For various reasons, my mind was changed on that and I continue to operate as a disregarded entity with no employees (having never filed paperwork to be treated as an S-corp).  On my W-9, I used my SSN as in instructed.

It is time for me to make an estimated payment to the IRS.  I enrolled in EFTPS using my EIN.  Is it ok to pay this way?  Also, I'd like to open a solo 401k which requires an EIN.  Is it ok to use this one?

My concern is that this EIN may be tied to my company name and not me as an owner (https://www.irs.gov/businesses/small-businesses-self-employed/single-member-limited-liability-compan... briefly mentions not using an EIN for your business on your w9 if you are a disregarded entity. Thankfully I didn't).

I could try requesting another EIN for just me as an owner, but that might just look worse/be more confusing?

Thanks for any help or insight you can give!

[ryan3brown]

I may be answering my own question but I just found in my EIN letter from the IRS the following quote:

"This EIN will identify you, your business accounts, tax returns, and documents, even if you have no employees"

[Critter · Accepted solution]

Estimated payments are PERSONAL and  should always be made using your SS# since you pay them personally and not thru the business ... if you try using the EIN they could get lost.  On the Sch C that you will file you will enter the EIN just for informational purposes so any 1099-misc forms issued to the business will be married with your federal tax return.  

[Critter]

You will NOT get another EIN for any reason and you should open a new EFTPS with your SS# so things don't get messy. And of course you must use the EIN for the retirement account ... seek guidance from the plan administrator to get it set up properly.

[ryan3brown]

Thank you for your replies.

[Carl]

My concern is that this EIN may be tied to my company name and not me as an owner

Your concerns are misfounded. That EIN is assigned to your business, and tied directly to your SSN. There are only two entities on this planet that know what SSN that EIN is tied to; you and the IRS. That's it. What you use for paying your taxes to the IRS really doesn't matter; be it the EIN or SSN. Remember, *ONLY* the IRS issues EINs, so ONLY the IRS and the applicant know what SSN that EIN is tied to.

When a client asks you for your tax identification number for business purposes, you provide them the EIN. Under no circumstances and with no exceptions should you ever provide your SSN. Why?

If your EIN is abused, it only affects your business. But if your SSN is abused it can ruin your entire life. I've been self-employed with a single member LLC for over 15 years now and have been asked numerous times to provide a W-9. I always provide my EIN and *only* my EIN. On the rare occation where I get a client that insist on the SSN, I just flat out refuse and as far as I'm concerned, they can take their business elsewhere. There is absolutely no reason what-so-ever for anyone to have a need for your SSN. In fact, even the bank where you may have your business accounts really doesn't need your SSN - just the EIN. But for a disregarded entity I have no problem providing a legitimate banking institution with both - it makes their recording keeping eaiser and simpler. Besides, as a signatory on the account I can see a bank having a valid need for both the EIN and SSN. But that's pretty much it.

Now for state taxes, you'll find on your state tax return for the business income, that form will have both your SSN and your federally issued EIN on it. So that's why it really doesn't matter what you use when paying your federal quarterly taxes. But I do agree with using the SSN when paying your quarterly state taxes.

Besides, of the 37 states that tax personal income, some will issue you a completely separate state tax ID number for the business, and you are required to utilize that state issued ID when paying your state quarterly taxes.  Hawaii is one such state that I'm aware of.

Bottom line is, when it comes to the business, you only give out your SSN if it is the only legal option available. Otherwise, they get the EIN or nothing at all.

[hjs738]

If I have an EIN for my single member LLC (eg Consulting Group LLC with JANE SMITH SOLE MBR) would I get another EIN to put on my W-9 since the instructions state "Do not enter the disregarded entity's EIN."

[ToddL99]

No, enter your SSN on the Form W-9 - do not enter the EIN for your single-member LLC.

Since it is a disregarded entity, income from your single-member LLC is reported and taxed on your personal tax return. If a payor requests a Form W-9 from you (to prepare the 1099-NEC or 1099-MISC),  you should provide your SSN.

Using your SSN for the W-9 will ensure  the IRS can match that income to your personal return.