Ok, this is common sense, however the IRS instructions for Form W-9 are very confusing:
If you are a single-member LLC that is disregarded as an entity separate from its owner, enter the owner’s SSN (or EIN, if the owner has one). Do not enter the disregarded entity’s EIN.
Thus, it seems IRS only wants the Disregarded LLC's EIN to be used for excise tax and employer-related tax returns like Form W-2, but not for Form 1099!
Yet, when you look at the Form SS-4 instructions, IRS provides a more detailed explanation to this effect, however it also is kind of waffling on the subject. See the underlined last sentence below:
Taxpayer Identification Number
For federal income tax purposes, a single-member LLC classified as a disregarded entity generally must use the owner's social security number (SSN) or employer identification number (EIN) for all information returns and reporting related to income tax. For example, if a disregarded entity LLC that is owned by an individual is required to provide a Form W-9, Request for Taxpayer Identification Number (TIN) and Certification, the W-9 should provide the owner’s SSN or EIN, not the LLC’s EIN.
For certain Employment Tax and Excise Tax requirements discussed below, the EIN of the LLC must be used. An LLC will need an EIN if it has any employees or if it will be required to file any of the excise tax forms listed below. Most new single-member LLCs classified as disregarded entities will need to obtain an EIN. An LLC applies for an EIN by filing Form SS-4, Application for Employer Identification Number. See Form SS-4 for information on applying for an EIN.
A single-member LLC that is a disregarded entity that does not have employees and does not have an excise tax liability does not need an EIN. It should use the name and TIN of the single member owner for federal tax purposes. However, if a single-member LLC, whose taxable income and loss will be reported by the single member owner needs an EIN to open a bank account or if state tax law requires the single-member LLC to have a federal EIN, then the LLC can apply for and obtain an EIN.
My point is, if you can use the LLC's EIN for state tax law and a bank's Form 1099-INT, why can't it also be used by other businesses on Form 1099-MISC? It seems really wrong that I'd need to use my older sole proprietor EIN for others to report their payments to my disregarded LLC even when it already has its own EIN!
I also really wonder, as was just described in this thread, since IRS in the back-end has the LLC's EIN linked to a responsible party's EIN or SSN, what really would happen if the disregarded LLC's EIN is used on a Form W-9 and Form 1099-MISC despite IRS's instructions?
