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.
It’s often required to open a business bank account. However, it creates separation between your business and personal finances because bankers, creditors, and the IRS will identify your business by its EIN rather than your personal Social Security number.
Also, it helps establish business credit, which will boost your access to financing. And, if you do 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 Rhode Island?
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:
Your local government may also require tax registrations.
How much will I be charged to get an EIN for my LLC in Rhode Island?
Applying for an EIN through the IRS is free. There are no associated fees when you apply directly with the IRS.
After submitting the application, how long until I receive my EIN Rhode Island?
For those who apply online, you’ll typically receive your EIN instantly after a successful application. Fax submissions usually take about four business days. Mailed applications might need up to 4-5 weeks for processing.
Can I simply use my personal SSN instead of getting an EIN for my Rhode Island LLC?
While some sole proprietors might use their SSN for certain business tasks, it’s strongly recommended for LLCs to obtain a separate EIN for privacy, liability protection, and other business-related requirements.
Does the EIN in Rhode Island have an expiry or need to be renewed?
Once assigned, an EIN remains with your LLC indefinitely. However, if there are major changes in the structure or ownership of the LLC, you might need a new EIN.
Is it feasible for non-U.S. residents to acquire an EIN for an LLC in Rhode Island?
Absolutely. Foreign nationals can obtain an EIN for their Rhode Island LLC. The process might differ slightly if they don’t have an SSN or ITIN, typically involving fax or mailed applications.
Are there Rhode Island-specific guidelines concerning EINs that I should know?
The EIN application process is federally standardized. However, once you possess an EIN, you should be aware of and comply with any Rhode Island-specific business regulations, licenses, or requirements.