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Need EIN for sole proprietor?

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  • Need EIN for sole proprietor?

    If I just want to do a simple sole proprietorship, do I need to obtain an EIN?

    Is there any advantage I would gain if I obtained an EIN? I am an ER doctor who is starting 1099 for the first time so curious. Thanks so much in advance.

  • #2
    If you don't have employees, no, but it can be useful if you don't want to put your SSN on as many documents floating around out there. When I had a non-medical sole proprietorship that needed a business bank account the bank insisted on having an EIN to open the account.

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    • #3
      If you want to open a one-participant 401k, most providers will require an EIN.

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      • #4
        Your TIN is your SSN.

        Like iglord said, look into obtaining an EIN if you don't want your SSN floating around.

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        • #5
          TDA doesn't require an EIN for solo-k's, but I know others do. Agree with @Craigy and @iglord - we recommend clients go ahead and get an EIN to use with banking, filing 1099s, etc. so you lower the risk of compromising your identity.
          Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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          • #6
            Is it too late to obtain an EIN once the LLC has been established?

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            • #7




              Is it too late to obtain an EIN once the LLC has been established?
              Click to expand...


              No, it's not. You will simply be changing the identification number associated with the business.
              Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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              • #8
                You usually have to establish the LLC before you can obtain an EIN for said LLC.

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                • #9




                  TDA doesn’t require an EIN for solo-k’s, but I know others do. Agree with @craigy and @iglord – we recommend clients go ahead and get an EIN to use with banking, filing 1099s, etc. so you lower the risk of compromising your identity.
                  Click to expand...


                  Fidelity didn't.

                   

                  Either that or I screwed something up.

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                  • #10
                     







                    TDA doesn’t require an EIN for solo-k’s, but I know others do. Agree with @craigy and @iglord – we recommend clients go ahead and get an EIN to use with banking, filing 1099s, etc. so you lower the risk of compromising your identity.
                    Click to expand…


                    Fidelity didn’t.

                     

                    Either that or I screwed something up.
                    Click to expand...


                    Fidelity doesn't require an EIN when you OPEN the solo K but they do recommend you have one eventually.

                    I think it does help to clearly delineate where the money is coming from and going to when you make the contributions.  Fidelity uses these contributions forms that are really for your own record keeping (they don't need it when you deposit the money into the account), but I find them helpful so that it provides a record for what is employee vs. employer (profit sharing) contribution.

                     

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