IRS Revises EIN Application Process

Starting May 13, 2019 only individuals with tax identification numbers (SSN’s & ITIN’s) may request an Employer Identification Number (EIN) as the “responsible party” on the Form SS-4 Application for Employer Identification Number and on the online EIN Application. The change will prohibit entities from using their own EINs to obtain additional EINs.

Curious as to who can be the “responsible party” on the EIN Application? For most companies it is defined by the IRS as “the person who ultimately owns or controls the entity or who exercises ultimate effective control over the entity. The person identified as the responsible party should have a level of control over, or entitlement to, the funds or assets in the entity that, as a practical matter, enables the person, directly or indirectly, to control, manage, or direct the entity and the disposition of its funds and assets.” There are exceptions for governmental agencies, publicly traded entities, tax-exempt organizations and trusts.

For questions about this change and how it may affect you please contact us.

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