If your LLC has more than one member or if you are going to hire employees, you’ll need an EIN. But these aren’t the only factors. The IRS offers a test to determine if you need an EIN:
Do you have employees?
Do you operate your business as a corporation or a partnership?
Do you file any of these tax returns: Employment, Excise, or Alcohol, Tobacco, and Firearms?
Do you withhold taxes on income, other than wages, paid to a non-resident alien?
Do you have a Keogh plan?
Are you involved with any of the following types of organizations?
Trusts, except certain grantor-owned revocable trusts, IRAs, Exempt Organization Business Income Tax Returns
Real estate mortgage investment conduits
If you answer yes to these questions, your business needs an EIN.
Benefits of Having an EIN
There are several reasons to get an EIN, even if you’re not required to have one.
First, opening a business bank account is often required, and it adds a degree of separation between your business and personal finances. Bankers, creditors, and the IRS will identify your business by its EIN rather than your personal Social Security number.
Second, it helps establish business credit, boosting your access to financing. Third, if you end up hiring employees in the future, you’ll already have your EIN and be ready to go.
What Do I Need to Get an EIN in Illinois?
According to the IRS:
All EIN applications (mail, fax, electronic) must disclose the name and Taxpayer Identification Number (SSN, ITIN, or EIN) of the true principal officer, general partner, grantor, owner or trustor. This individual or entity, which the IRS will call the ‘responsible party,’ controls, manages, or directs the applicant entity and the disposition of its funds and assets. Unless the applicant is a government entity, the responsible party must be an individual (i.e., a natural person), not an entity.
When you fill out the application, you’ll need the following:
Name, title, and Social Security number of managing member or owner
State in which your business is registered
Reason for applying
Main business activity
Closing month of your accounting year
Contact phone number and email
How to Apply for an EIN in Illinois
The application is Form SS-4, and you can submit it via the IRS website. Alternatively, you can print the form and fax or mail it. If you apply online, your EIN will be issued immediately.
There is no cost to obtain an EIN, which never expires.
Register for Illinois Taxes
You also may need to register for business taxes in Illinois. In addition, if you have employees, you’ll need to register to withhold state income taxes and unemployment taxes.
You’ll need to register for sales tax if you sell goods or services subject to sales tax. You can register for all three on the My Tax Illinois website.
Your local government may also require certain tax registrations.
Even if your LLC does not need to obtain an EIN in Illinois, getting one is probably the best move for your business, its finances, and its future. Just be sure to fill out the forms correctly and keep your business on the path to success.
Is there a fee associated with obtaining an EIN for my Illinois LLC?
No. When applying directly with the IRS, there is no charge for securing an EIN.
What's the typical wait time to receive my EIN in Illinois after application?
Online applications usually provide an EIN instantly upon completion. For faxed submissions, it may take up to four business days, while mailed forms could require 4-5 weeks.
I'm the sole member of my Illinois LLC. Can I simply use my SSN instead of an EIN?
While single-member LLCs can sometimes use the owner’s SSN for select transactions, obtaining an EIN for your Illinois LLC offers better privacy and can simplify many business processes.
Can a non-U.S. resident apply for an EIN for their Illinois LLC?
Yes. Foreign nationals or entities can secure an EIN for an Illinois-based LLC, even without an SSN or ITIN. This is typically done by faxing or mailing Form SS-4.
Are there specific considerations for Illinois regarding EINs?
While the EIN process is a federal matter overseen by the IRS, once you have your EIN, it’s vital to understand and adhere to any specific business and tax duties in Illinois.
If I make major changes to my Illinois LLC, do I need to get a new EIN?
Certain structural changes might require a new EIN. However, things like changing the business address usually do not. Always consult with a tax professional if unsure.