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Once a Delaware LLC has its Certificate of Formation stamped and approved by the state of Delaware, the next step is to obtain a Federal Tax ID Number, also known as an EIN, from the IRS. Please note that this not a Delaware Tax ID (from the state), but rather a federal number. You do not need a separate Tax ID from the state of Delaware itself.
An SS-4 form should be completed and submitted to the IRS in order to generate the Federal Tax ID number. When applying for the EIN, you will be required to answer a number of questions in order to complete the SS-4 application.
Here is a list of information you'll be asked to provide:
Name of the LLC: The exact name submitted to the Delaware Division of Corporations office; be sure to include the full name with "LLC" at the end.
To whom should notifications be sent: The IRS would like to know with whom they should communicate; this person can be located anywhere in the world. Some examples could be the LLC’s member, manager, tax professional or attorney.
Mailing address of the LLC: Where tax-related correspondence should be sent; this does not have to be an address in the United States.
County and state where principal place of business is located: The IRS needs to know exactly where this will be. The principal place of business can be located anywhere in the world and does not have to be in the United States.
Name and Social Security number of the responsible party: Typically this is one of the members of the LLC. Keep in mind that a member of a Delaware LLC does not have to be located in the U.S. or even a citizen of the U.S. The member can be located anywhere in the world. If the member does not have a Social Security number, that is acceptable; however, if the member does have a Social Security number, it must be provided.
How the LLC is going to be taxed: This is a crucial step and can have drastic tax consequences for the LLC. Typically, the LLC will automatically be classified as a partnership if it has more than one member.
If there is only one member, the classification is a sole proprietorship (for a single-member LLC) for federal tax purposes; this means the LLC will have the asset protection the LLC affords but the taxation is the same as a partnership (for a multi- member LLC) or a sole proprietorship (for a single-member LLC).
An LLC will typically be required to file the same federal tax forms as a partnership or sole proprietorship when it comes time to prepare and file the federal tax returns with the IRS.
An LLC may elect to be treated and taxed as an S corporation or a C corporation by the IRS. It may be a good idea to consult a tax professional regarding the consequences and benefits of making the S or C corp election with the IRS.
Clients can change the classification with the IRS at any time in the future with the help of a tax professional.
Date the business was started or acquired: This is typically the date of formation of the Delaware LLC.
Closing month of the accounting year: To keep things simple, most of our clients choose December, unless specifically instructed by their tax professional to choose otherwise.
Highest number of employees expected: This information can always be updated and is hard for new companies to gauge since there are many factors that come into play. Clients typically do their best to estimate this figure.
Select a category the LLC best falls into: There are 12 categories. Do your best to choose one. If you're unsure, there is an option for "Other."
Brief description of the business: Do your best to tell the IRS a little bit more about what the LLC will be doing. If Construction was selected as a category, what type of construction? If Other was selected as a category, provide a brief description of the activities.
Don't let the process of obtaining a Tax ID number for your Delaware LLC intimidate you. We offer a service to quickly and easily obtain a Tax ID number for a new Delaware LLC. Let us handle the process for you, so you won't have to manage the stress and aggravation of dealing with the IRS.
THE AUTHOR OF THIS BLOG ARTICLE IS NOT A LAWYER AND HARVARD BUSINESS SERVICES, INC. IS NOT A LAW FIRM. THE ARTICLE ABOVE IS NOT INTENDED AS LEGAL ADVICE AND SHOULD NOT BE TAKEN AS LEGAL ADVICE. THIS SHORT ARTICLE IS STRICTLY TO MENTION SOME ASPECTS OF DELAWARE’S CORPORATION LAWS AND/OR LAWS RELATING TO OTHER FORMS OF ENTITIES WHICH YOU MAY NOT BE FAMILIAR WITH. WE RECOMMEND THAT YOU CONSULT WITH A LAWYER BEFORE FORMULATING A STRATEGY WHICH WILL BE SUITABLE FOR YOUR SPECIFIC CASE.
There are 5 comments left for How to Get a Tax ID Number for a Delaware LLCDokmai Rwanda Trading LLC said: Friday, October 26, 2018
we have just incorporate in Delaware but we realise that even with an EIN we are not able to open a paypal or 2checkout account as they ask for a SSN which we do not have as the owner/shareholder do not live in the USA. Thus for us the incorporation was a waste of money because our major objective was to facilitate payments for goods to our clients in the USA who seem to be paypal usersHBS Staff replied: Friday, November 2, 2018
Traditionally the Social Security Number or SSN is a number that is issued at birth in the United States. The second type of individual tax number is the ITIN number. The term “ITIN” stands for Individual Taxpayer Identification Number. Any person who needs a tax identification number but is not eligible to obtain a Social Security Number can apply for an ITIN. Many of our non US clients use this ITIN when applying for the bank account, accounts with Paypal or other online merchants.
Here is an article on the how you can personally obtain the ITIN number.
Neo said: Monday, October 8, 2018
Hi If a Delaware LLC is owned by a persons who are not US citizens and live in EU and if the LLC doesn't have any employees and doesn't do any business in US, does it have to get a Tax ID number? Best regardsHBS Staff replied: Monday, October 8, 2018
The Federal Tax ID Number is typically necessary for an LLC or corporation to lawfully conduct business activities, especially if you're operating a business in the United States. All U.S. companies are required to have an EIN to open a U.S. bank account, obtain loans, hire employees or if there is a tax or reporting requirement to the U.S. Government for the entity. We have found that many non-U.S. banks are now requiring the company to have an EIN number to open the bank account.Muhammad Yaseen said: Sunday, February 11, 2018
Looking to get EIN , is it possible to get without a LLC , also my business would be within the US and outside the US. I am going to do business with Charter, Directv and Comcast as a retailer, do this needs some special requirements, as i understand that i need to pay $300 per year a flat tax being as a Delaware LLC . However i would be getting my payments in NON US Bank. In case in future if we are using our US Bank , do we need to pay some extra tax like Income tax etc beside the LLC Per anum flat tax? Please send me complete package details for 1.Registering a Delaware LLC 2.Obtaining IEN/ tax number 3.Your Agent services 4. Address for mailHBS Staff replied: Monday, February 12, 2018
Here is where you can find the information you are seeking:
Forming a Delaware LLC: https://www.delawareinc.com/ourservices/compare-domestic-packages/
Obtain EIN: https://www.delawareinc.com/ourservices/obtain-tax-id-or-ein-for-delaware-company/
Delaware Registered Agent services (this would be automatic if we formed the LLC for you): https://www.delawareinc.com/before-forming-your-company/what-is-a-delaware-registered-agent/
Virtual Office and Mail Forwarding services: https://www.delawareinc.com/ourservices/mail-forwarding/
Feel free to call us at 1-800-345-2677 or live chat from our homepage for more information.
Alfred Diaz said: Thursday, September 14, 2017
What is a Randico llc. And what does Randico meanHBS Staff replied: Friday, September 15, 2017
We do not know that company. You could try looking it up in the Delaware Division of Corporations database, if it is a Delaware LLC.
DR SREENIVASULU VAYYAVURU said: Monday, November 28, 2016
I want to register an LLC and I do NOT HAVE SSN OR ITIN. I want EIN and Bank account to be opened. RANDICO LLCHBS Staff replied: Tuesday, November 29, 2016
Please give us a call during business hours (Mon - Fri, 9-5, EST) at 1-800-345-2677 or you can Live Chat with us from our homepage. We can register the LLC for you and obtain an EIN for you as well.