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 Utah?
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 Utah
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 Utah Taxes
You also may need to register for business taxes in Utah.
You’ll need to register to withhold state income tax and unemployment taxes if you have employees. In addition, you’ll need to register to collect and pay sales tax if you sell goods or services subject to sales tax.
Your local government may also require certain tax registrations.
Even if your LLC does not need to obtain an EIN in Utah, 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.
How much does it cost to obtain an EIN for my Utah LLC?
If you apply for an EIN directly through the IRS, there is no fee. Beware of third-party services that might charge for obtaining an EIN on your behalf.
How long does the online EIN application process take in Utah?
The online application process is quick, often providing you with your EIN immediately upon completion of the application.
I already have an EIN for a sole proprietorship; can I use the same one for my Utah LLC?
No. If you transition from a sole proprietorship to an LLC or form a new entity type, you will need to obtain a new EIN.
Can I use my personal Social Security Number (SSN) instead of an EIN for my Utah LLC?
It’s not advisable. Having an EIN establishes a clear separation between your personal finances and your business, which can be crucial for liability and tax purposes.
Do I need to renew my EIN annually in Utah?
No, once your Utah LLC has been assigned an EIN, it will not expire. However, there are certain situations, like changes in the business structure, that might require you to obtain a new EIN.
Do I need to have my Utah LLC officially formed in Utah before applying for an EIN?
Yes. Before you can apply for an EIN, the state of Utah must recognize your LLC as a legally formed entity.