IRS Revises EIN Application Process

Starting May 13, only individuals with either a Social Security number (SSN) or an individual taxpayer identification number (ITIN) may request an Employer Identification Number (EIN) as the “responsible party” on the application. This change will prohibit entities from using their own EINs to obtain additional EINs. The requirement will apply to both the paper Form SS-4, Application for Employer Identification Number, and online EIN applications. Entities that may be affected include:

  • Single member limited liability companies (SMLLC)
  • Estates and trusts
  • Parent companies forming subsidiaries
  • Employer retirement plans
  • Tax lien participants (some states have tax lien auctions where an EIN is used as party of a lottery process)

Only governmental entities (federal, state, local and tribal) are exempt from the responsible party requirement, as well as the military, including state national guards.  There is no change for tax professionals who may act as third-party designees for entities and complete the paper or online applications on behalf of clients. Click here for details.