IRS Changes EIN Website Rules … Again

The IRS has been busy, quietly changing the rules on how it issues EINs, aka Tax Identification Numbers, Tax ID numbers, Employer Identification Numbers, FEINs, etc.

It used to be that you could apply online for as many EINs as you needed. I particularly liked the online system when I was creating Series LLCs, because I could get the parent EIN and the Cell EINs all in one shot. Plus, it was open late at night and on both Saturday and Sunday. Then the system changed to 5 per day, per person … and then the hours changed, and then the ability to apply for wholly owned subsidiaries changed.

I’ve watched the IRS change almost every aspect of the EIN process this year. As of today:

  • You can only apply for one EIN per day, per Social Security Number
  • If you filed for a parent company’s EIN online, you can’t apply online for a 100% owned subsidiary
  • You can only apply Monday through Friday, from 7am to 10pm EST

For most people, these things aren’t going to have a significant impact. But if you have a Series LLC, or if you are a commercial service provider, like my business, you will have some planning to do, to accommodate busy times.

It doesn’t really make sense to shut down an automated system over the weekend – there is no human intervention on issuing the EINs normally – you apply, and receive the number instantly, so there is no waiting for human approval. Filing for an EIN over the phone or by fax, in comparison, does take longer and does require direct human intervention. At a time when government agencies are looking for ways to save money, the IRS looks to be going backwards, gutting a functional online system for a less efficient, manual system. Or, it could be part of a larger plan by the IRS to require more information on who’s setting up businesses in the United States. But regardless of how you look at it, you will need to be aware of the new limitation and plan for it, especially if you are setting up several businesses at once in more complicated transactions.

There are many variables when you’re structuring a business. That’s why it’s hard to go through a quick-service website. Unless you talk to someone who’s got some knowledge and experience on both the tax and the legal side, it’s hard to know what you don’t know. And that can leave you vulnerable.

Got questions? Contact us! We’re here for you.

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