21.7.13  Assigning Employer Identification Numbers (EINs) (Cont. 1)

21.7.13.3 
Receiving EIN Requests

21.7.13.3.9 
Bulk/Bank Assignment Requests (CAMC Only)

21.7.13.3.9.1  (10-01-2013)
Entities Qualifying for Bulk/Bank Assignments

  1. Entities qualified to receive bulk/bank EINs include:

    • Bankruptcy estates created under Chapter 7-11 of the Internal Revenue Code

    • Pension/Retirement Trusts

    • Government National Mortgage Association (GNMA) Pools

    • Federal National Mortgage Association (FNMA), and

    • Real Estate Mortgage Investment Conduits (REMICs)

    Caution:

    Forward all requests from entities to be added as a participant in the bulk/bank program to the Accounts Management (AM) Headquarters (HQ) PPM analysts. HQ approval is required before any new entity can be added to the program.

21.7.13.3.9.2  (10-01-2012)
Batching Bulk/Bank Requests

  1. Bulk/bank requests are received either by mail or fax.

  2. Requests must be in writing on company letterhead and state the following:

    • What the EIN(s) will be used for (for example, bankruptcy estate, pension plan)

    • The number of EIN(s) needed, and

    • The contact person's name and telephone number

    Note:

    If any of the above information is missing, refer to the company's file. If there is no file on record, contact the company by telephone to obtain the missing information. Review the number of EINs being requested by the entity compared to prior requests. Report any significant increase to the AM HQ PPM analysts. Do not assign the block until approval is received from the analysts.

  3. Separate and batch all requests received into three sub-categories:

    • Requests

    • Consolidated Lists, and

    • Correspondence

      Note:

      See IRM 21.7.13.7.2 for more information about processing timeframes and batching requirements.

21.7.13.3.9.3  (10-01-2008)
Assigning an EIN Block (CC BSIGN)

  1. Use CC BSIGN to assign a block of EINs, using the guidelines in the table below:

    If the request is for Then enter
    • Bankruptcy Estates

    • GNMAs

    • The appropriate EIN prefix for the entity's location (identified as NN in the example below)

    • A 6 or 7 (so that a number in the 6/7 million series can be assigned), and

    • The number of EINs being requested.


    Example:
    Input BSIGN NN 6 20 Name of Institution
    Response Beginning EIN NN-70000000
    Ending EIN NN-7000019
    Pension Plans
    • The appropriate EIN prefix for the entity's location (identified as NN in the example below)

    • An "R" (so that an EIN in the "regular series" will be assigned), and

    • The number of EINs being requested.


    Example:
    Input BSIGN NN R 20
    Name of Institution

    Response Beginning EIN NN-40000000
    Ending EIN NN-4000019.
  2. Print the response screen and attach the printout to the original company letterhead.

  3. Send Letter 225C, EIN Block Assignments for Trusts and Estates.

    Note:

    If a fax number was provided, the EIN block assignment can be faxed to the institution/authorized representative.

    Reminder:

    Make sure you have received the proper authorization document before disclosing an EIN block assignment to a representative acting on behalf of the institution. See IRM 21.7.13.3.3.

  4. Create a folder for the institution/authorized representative and retain the following:

    • The response screen and original request

    • A Block EIN(s) assignment log sheet (to record and track actions) when received

    • The date on the cover letter that the consolidated list was returned by the institution/authorized representative when the EIN(s) are assigned, and

    • The date on the cover letter of any correspondence

  5. If a consolidated list, using up the entire block of EINs assigned, has not been received after 30 days, send an interim Letter 225C, or fax the financial institution or authorized representative. Explain that the institution/representative has up to 45 days from the date of issuance of the block to send in the consolidated list. No extension of time to use the block will be granted without extenuating circumstances.

21.7.13.3.9.4  (10-01-2005)
Telephone Calls Related to Bank List Program

  1. Telephone service for the bank list program is not on the call router; calls are directly dialed to the campus of record. Return bank list program-related calls within a 24 hour period.

21.7.13.3.9.5  (01-13-2009)
Processing a Consolidated List Returned by an Institution/Authorized Representative

  1. When a financial institution or authorized representative supplies their client with an EIN from a block issued by the IRS, it must submit a consolidated list that contains the following information:

    • EIN(s) assigned

    • Exact name of entity to which the EIN(s) are assigned

    • Name of trustee or executor

    • Address, and

    • Date established

      Note:

      If any of the information listed above is missing, contact the institution/authorized representative to obtain it.

  2. Research the entity to which the EIN(s) have been assigned to determine whether it has been previously established using the following command codes:

    • CC ENMOD

    • CC NAMEB, and/or

    • CC NAMEE

      Note:

      See IRM 21.7.13.4.2 for more detailed information on researching taxpayer information.

  3. If the entity has not been established, follow the appropriate EIN assignment procedures for the entity type. See IRM 21.7.13.5.

    Exception:

    Enter the assigned EIN(s) in the upper left corner of the CC ESIGN screen (to prevent the system from auto-generating an EIN).

    Reminder:

    Enter Notice Code Indicator "D" to suppress the CP575 notice.

    Note:

    Banklist customers are only required to supply us with the following information: 1) EIN assigned, 2) exact name of entity to which the EIN(s) are assigned, 3) name of trustee or executor, 4) address and 5) date established. If additional information is available from the consolidated list, input it onto CC ESIGN. Otherwise, information not required from the taxpayer will be left blank on CC ESIGN. Do not correspond with the customer or perform research for information that is not required.

  4. After entering the consolidated list, send Letter 225C, EIN Block Assignment for Trustees and Estates, to the institution/authorized representative, confirming that the consolidated list has been validated. If the institution/authorized representative requests Letter 225C be faxed to them, do so.

    Note:

    If an authorized representative of the entity requests confirmation of individual EINs assigned, send the representative Letter 147C, EIN Previously Assigned.

  5. Retain the consolidated list in the folder that was created when the block was assigned.

21.7.13.4  (10-01-2005)
Determining Whether an Entity Needs an EIN

  1. Before assigning a new EIN, always perform research to determine whether an EIN is needed. This subsection contains procedures for:

    • Handling taxpayer inquiries about whether an EIN is needed (IRM 21.7.13.4.1.)

    • Performing research to ensure that a taxpayer does not already have an EIN (IRM 21.7.13.4.2.)

    • Entering search criteria (IRM 21.7.13.4.2.1. )

    • Research Command Codes (IRM 21.7.13.4.2.2. )

    • Research using Command Code ENMOD (IRM 21.7.13.4.2.3.)

    • Actions to take if an EIN is found (IRM 21.7.13.4.2.4.)

    • Resolving duplicate EINs (IRM 21.7.13.4.2.5. )

    • Reactivating an EIN (IRM 21.7.13.4.2.6. )

    • Taxpayer claims he/she did not request an EIN (See IRM 21.7.13.4.2.7.)

    • Determining whether a new EIN is needed when the ownership/classification of an entity changes (See IRM 21.7.13.4.3.)

    • EINs required for business purposes (IRM 21.7.13.4.4.)

21.7.13.4.1  (01-06-2014)
Responding to Taxpayer Inquiries

  1. Use the information in the table below to determine whether a new EIN is needed, based on a taxpayer inquiry.

    If Then
    The taxpayer previously had an EIN for the same entity The same EIN is used.
    The taxpayer is incorporating using the same name and in the same state as another corporation whose filing requirements have been closed Issue a new EIN if the inquiry was submitted in writing via correspondence. If the inquiry was received from toll free phones, advise the caller to submit a Form SS-4 by fax or mail.

    Note:

    Research the previous corporation's account for cancellation of filing requirements.

    The taxpayer is incorporating using the same name and in the same state as another corporation with open filing requirements
    1. Check to see if it is the same corporation.

    2. If not, ask the taxpayer to produce proof of incorporation (articles of incorporation) and submit a Form SS-4 with articles of incorporation/organization by fax or mail.

    A bank will not accept the taxpayer's EIN because another taxpayer has a number exactly like it Do not issue an EIN.

    Note:

    Banks do not use dashes to distinguish EINs from SSNs. It is the responsibility of the taxpayer to contact the bank to settle the issue.

  2. If the taxpayer and/or their authorized representative requests a written confirmation of their EIN, fax or mail it accordingly.

21.7.13.4.2  (10-01-2006)
Researching Taxpayer Information

  1. To avoid any possibility of duplication, when you receive a request for an EIN, always perform research to verify that an EIN has not previously been assigned.

  2. Two command codes, NAMEI (Individual Master File (IMF)) and NAMEB (BMF), have been added to the Name Search Facility (NSF) project. The command codes access the NSF data base and produce output similar to that of the NSF command codes, NAMES and NAMEE. There are also two hardcopy options, NAMEIX, NAMEBX. Instructions for the use of these command codes have been added to IRM 2.3.60.

    Note:

    For complete instructions for using command codes, refer to the IDRS Command Codes Job Aid located on SERP.

21.7.13.4.2.1  (10-01-2010)
Entering Search Criteria

  1. When using any of the command codes described in this subsection, research the entity thoroughly for:

    • All names of the owners, such as partners (for example, Smith & Jones, Jones & Smith, Smith and Jones)

    • Spelling variations, such as one word versus two words (for example, Safe Guard and Safeguard)

    • Name of business with punctuation and without (for example, A–B–C–D and ABCD and A B C D)

    • The taxpayer’s name and mailing ZIP code. (If nothing is found, use the location ZIP code, three or five digit number.)

  2. If you cannot locate an account, always verify you have input the information correctly before proceeding.

21.7.13.4.2.2  (10-01-2006)
Research Using Command Codes (CC) NAMEI, NAMEB, NAMEE, AND NAMES

  1. Research an entity using CC NAMEB AND NAMEE to determine if an EIN has already been assigned. Use various elements of the search criteria (parameters) to research the entity thoroughly (primary name, DBA name, combinations of state, zip code, street address). See IRM 2.3.60, Command Codes NAMES, NAMEE, NAMEI, NAMEB, FINDS, and FINDE for additional information.

  2. Research the entity using the Name Search Facility (NSF) with the appropriate command code as described in the table below.

    If you are searching for an account with an Then use
    EIN already assigned CC NAMEB, NAMEE
    SSN/IRSN/ITIN CC NAMEI, NAMES

21.7.13.4.2.3  (10-01-2005)
Research Using CC ENMOD (Taxpayer Information File)

  1. If it appears that the taxpayer already has an EIN, use CC ENMOD to research the number in question. If your research cannot find the EIN on the Tax Information File (TIF), search Master File using CC BMFOL or CC INOLE.

21.7.13.4.2.4  (03-11-2014)
If an EIN is Found/Not Found

  1. After researching for a previously assigned EIN, use the information in the table below to determine the appropriate action to take.

    Caution:

    EIN Toll Free Telephone Assignment is discontinued effective January 6, 2014. See IRM 21.7.13.3.5.1

    If Then
    A previously assigned EIN is not found Assign an EIN, using the appropriate procedure for the entity type. See IRM 21.7.13.5.
    A previously assigned EIN is found for a mailed or faxed Form SS-4 and there are no changes in entity type or ownership Send Letter 147C, EIN Previously Assigned, to notify the taxpayer of a previously assigned number.
    If a previously assigned EIN
    • Is found during a phone call, and

    • The account has posted to Master File

    After performing proper disclosure procedures. See IRM 21.7.13.3.5.6.1 for Sole Proprietors and IRM 21.7.13.3.5.6.2 for all other entity types verbally release the EIN to the caller or authorized third party. See IRM 21.7.13.3.3. for disclosure to third parties. If the taxpayer and/or authorized representative requests an immediate written confirmation of their EIN, mail or fax it accordingly.

    Caution:

    Advise unauthorized third party callers that we can only mail EIN confirmations to the address of record.

    A previously assigned EIN
    • Is found, and

    • The assignment of the EIN is within a two week period

    • And the account has not posted to the Master File

    Advise the caller to allow time for the receipt of the generated CP 575 verifying an EIN assignment.

    Exception:

    If the taxpayer and/or their authorized representative requests an immediate written confirmation of their EIN, mail or fax it accordingly.

    Exception:

    If the taxpayer received an EIN using the online application and elected to receive the CP 575 online but experienced a problem saving or printing the notice, send the taxpayer Letter 147C since a CP 575 notice will not be mailed. If the taxpayer or their authorized representative requests an additional fax confirmation in this situation, fax it accordingly.

    A previously assigned EIN is found on CC NAMEE/NAMEB, but the EIN has dropped off Master File due to inactivity. Reactivate the EIN using CC ENMOD/ENREQ TC 000 procedures. See IRM 21.7.13.4.2.6.
    A previously assigned EIN
    • Is found, and

    • A change in entity classification, status, and/or ownership is indicated

    See IRM 21.7.13.4.3, Entity Classification and Ownership Changes
    Two EINs are found See IRM 21.7.13.6.3, Consolidating Duplicate EINs.

21.7.13.4.2.5  (10-01-2007)
Resolving Duplicate EINs

  1. If, during the research process, you discover that an entity has been assigned two EINs, See IRM 21.7.13.6.3 for instructions on resolving this condition.

21.7.13.4.2.6  (10-21-2009)
Reactivating an EIN (TC 000)

  1. Prior to January 1, 2008, an EIN that was assigned but not used within a three year period was dropped from Master File in an annual extract run at the end of each year. These EINs are not found using Command Codes ENMOD, BMFOL, or INOLE, but are still maintained on Command Codes NAMEE and NAMEB.

  2. If an EIN is located on CC NAMEE/NAMEB and you can determine it belongs to the entity, reactivate the account by first inputting CC ENMOD, then CC ENREQ as shown below. Take this action whether the inquiry is received on the phone or by correspondence.

    Line Element Name Description and Validity
    1 ENREQ Command Code—required
    1 INTEND TO BUILD INDICATOR TC000 INTEND TO BUILD INDICATOR — "1" must be entered in position 20 of line 1 if the intent is to establish an account on the Master File (a TC 000 will be input).
    2 NM-CTRL Name Control — Must meet Standard criteria for a TIN Name Control
    2 CASE STATUS Case Status Code—"A" or "C"
    2 CASE CTRL Case Control — Must be a valid Case Category Code.
    2 IRS RECEIVED DATE IRS Received Date — An * (asterisk) in the first position will generate current date.
  3. The response to the above entries is a CC BNCHG screen pre-populated with the EIN and Name Control. Input TC 000 and all information including Primary, Sort, and Care-of Name lines, X-Ref TIN or Sole Prop TIN, Location and Mailing Addresses, BOD, WPD, Employment Code, Filing Requirements etc. This information is to be gathered from a paper Form SS-4, or verbally from the taxpayer or their authorized third party representative.

    Note:

    When reactivating accounts with no filing requirements ("O" files), input a "1" in the NOT-REQUIRED> field. Otherwise, an error message will be returned stating "AT LEAST ONE FIL REQ MUST BE INPUT" .

  4. The TC 000 will post to Master File and re-establish the entity. Always send Letter 147C to the taxpayer.

    Note:

    If the taxpayer and/or their authorized representative requests an immediate fax confirmation of their EIN, fax accordingly.

21.7.13.4.2.7  (12-29-2010)
Taxpayer Claims He/She Did Not Request EIN

  1. Identity theft occurs when someone uses your name, SSN/TIN, credit card number or some other piece of your personal information. Some taxpayers have contacted EIN units after receiving a CP 575 identifying them as the owner of a new EIN. They claim they did not apply for an EIN.

  2. Take action on a case by case basis. There is no specific order or process to follow. The main thing is to be sure the person did not apply and does not want the number associated with their name. Use the table below to assist you.

    Reminder:

    Most of the situations when a taxpayer contacts us stating they did not request an EIN are when a third party requested an EIN on the taxpayer’s behalf for a legitimate business purpose. Therefore, it is important to determine if that is the situation which led to the taxpayer contacting us.

    If Then
    A taxpayer indicates that he or she did not apply for a number they received Determine that the number was not applied for by a spouse or other family member, a neighborhood club , or an accountant or other third party on their behalf (such as a fiscal agent, bank or executor of a trust).

    Note:

    Thorough research and/or direct contact with the customer can usually resolve the situation. One item you may want to determine is if both addresses (the one on the notice and the address of record) are the same.

    The addresses are the same Probe further on the above issues.
    The addresses are different Determine if customer is aware of the other address.

    Reminder:

    The CP 575 is issued to the address on lines 4/5 on Form SS-4. Therefore, if a third party designee submitted Form SS-4 with the taxpayer’s address, the taxpayer would receive the CP 575 and may not be aware that the third party submitted the Form SS-4 on the taxpayer’s behalf. The third party does not receive the CP 575.

    Taxpayer still indicates they did not apply
    1. If no action has occurred on the account, take action to invalidate the number.

    2. Depending on whether you have access to IDRS or AMS, place a history item or note on the account. (If you place a history item on IDRS, place it on ENMOD.) The history item or note should indicate info such as "Taxpayer claims EIN not requested" .

    Action has been taken on the account Contact CI. Provide the EIN and advise them that the taxpayer states he/she did not request the EIN. Also, take the action described in Step 2 in the box above.
    The taxpayer believes their identity has been stolen Provide them with the Federal Trade Commission’s Theft Hotline phone numbers. They are:
    • 1-877-IDTHEFT (1-877-438-4338)

    • TDD – 202-326-2502

    If they want to file a complaint, inform them they can do so by visiting the Website www.ftc.gov/idtheft, or by writing to:
    Identity Theft Clearinghouse, FTC
    600 Pennsylvania Avenue, NW
    Washington, D.C., 20580
  3. Additional information on Identify Theft procedures can be found on the SERP - Identity Theft page.

21.7.13.4.3  (10-01-2008)
Entity Classification and Ownership Changes

  1. If an EIN request is received indicating a change in ownership, examine the request carefully to determine whether a new entity has been created or only the name has been changed.

  2. This subsection contains information to help you determine whether an EIN is needed when an entity changes its classification (See IRM 21.7.13.4.3.1) or ownership changes to the following entities:

    • Sole Proprietorships (See IRM 21.7.13.4.3.2. )

    • Corporations (See IRM 21.7.13.4.3.3.)

    • Partnerships (See IRM 21.7.13.4.3.4.)

    • Disregarded Entities (See IRM 21.7.13.4.3.5. )

  3. See IRM 3.13.2 for more information on rules concerning Form 8832, Entity Classification, and Form 2553, Election by a Small Business Corporation.

    Note:

    During EIN assignment, appropriate filing requirements for the entity being established will be assigned, regardless of notations on the Form SS-4 or statements from the taxpayer that Form 8832 or Form 2553 will subsequently be filed with the Service. On the phone, explain to the taxpayer that once the Form 8832 and/or Form 2553 have been processed, the account will be updated to reflect the entity classification change. Do not correspond with the taxpayer on this issue, as the CP 575 discusses entity classification changes.

21.7.13.4.3.1  (10-01-2007)
Entity Classification Changes Requiring a New EIN

  1. The table below identifies entity type changes that require issuance of a new EIN.

    From To
    • Individual/Sole Proprietor

    • Partnership

    • Corporation


    Exceptions: A new EIN is not necessary if:
    • An individual is doing business as a Limited Liability Company and changes its classification by filing Form 8832, Entity Classification , or

    • A disregarded entity changes its classification so it is recognized as a separate entity, and the entity already has an EIN

    See IRM 21.7.13.5.1.3.
    Partnership
    • Individual/Sole Proprietor or

    • Corporation

    Corporation
    • Individual/Sole Proprietor

    • Partnership

    Note:

    See IRM 3.13.2.25Domestic Limited Liability Company (LLC), for information on entity classification changes involving LLCs.

21.7.13.4.3.2  (01-13-2009)
Changes to Sole Proprietorships

  1. Assign a new EIN to a sole proprietorship if any of the following are true:

    • The sole proprietorship changes ownership from one individual to another.

    • The sole proprietor goes into bankruptcy (except under IRC Chapter 12 or 13). Assign a new EIN to the Bankruptcy Estate. Do not assign another sole proprietor EIN to the taxpayer.

    • The sole proprietor dies, and either an estate or a spouse (when there is no estate involved) takes over the business.

      Note:

      If the decedent and spouse have been filing a joint return for household employment taxes only, and the spouse takes over as employer, a new EIN is required for the spouse after the first year of the ownership change.

    • The sole proprietor takes in partners and operates as a partnership.

    • The sole proprietor incorporates.

  2. Do not assign a new EIN to a sole proprietorship under the following circumstances:

    • The sole proprietor has one business and opens a second sole proprietorship. (An individual is permitted to have only one identification number regardless of the number or types of sole proprietorships he/she operates.)

21.7.13.4.3.3  (10-01-2008)
Changes to Corporations

  1. Assign a new EIN to a corporation if any of the following are true:

    • A corporation is operating under a new corporate charter.

    • A new corporation is created after a statutory merger.

  2. Do not assign a new EIN to a corporation under the following circumstances:

    • The corporation changes its name only, the structure of the corporation remains unchanged, and it operates under the same charter.

    • The corporation files bankruptcy.

    • The corporation purchases another employing entity, a consolidated return is filed, and the purchaser uses the original EIN.

    • The entity changes its classification by filing Form 8832, Entity Classification.

21.7.13.4.3.4  (10-01-2010)
Changes to Partnerships

  1. Assign a new EIN to a partnership under the following circumstances:

    • The partnership terminates (all of its operations are discontinued and no part of any business, financial operation, or venture is continued by any of its partners in a partnership) and a new partnership is begun.

    • A shift of more than 50 percent of ownership has occurred.

  2. A new EIN is not necessary if any of the following are true:

    • The partnership terminates because of a sale or exchange of more than 50 percent of the total interests in the partnership capital and profits ( IRC 708(b)(1)(B)).

    • The entity changes its classification by filing Form 8832, Entity Classification.

    • The partnership declares bankruptcy.

    • The partnership changes locations or adds locations.

    • The partnership changes its name.

21.7.13.4.3.5  (10-01-2008)
Disregarded Entities

  1. A disregarded entity is a business entity having a single owner, which can be an individual or another business entity. If the entity is disregarded for income tax purposes, its activities are treated as a sole proprietorship (if the owner is an individual), or as a branch or division of the owning entity (if the owner is a business entity). Generally, the taxpayer will inform you that he/she is a disregarded entity. As of January 1, 2009, single member LLCs that are not taxed as corporations are treated as separate from their owners for employment tax purposes.

  2. Assign an EIN to a single member LLC not taxed as a corporation, if the entity does not already have an EIN and:

    • The entity has employees for the first time and the owner needs to obtain an EIN for employment tax reporting purposes, or

    • The owner wants to obtain an EIN for purposes other than federal tax reporting.

21.7.13.4.4  (05-25-2012)
EINs Required for Business Purposes

  1. If a taxpayer indicates that an EIN is needed for business purposes (for example, to acquire professional licenses, to collect sales tax on retail sales, or for banking purposes), then assign an EIN, unless the entity already has one.

    Caution:

    A responsible party may only receive one (1) EIN per day. SeeIRM 21.7.13.2.2.2 for more information.

21.7.13.5  (10-01-2006)
Assigning EINs

  1. This subsection contains information on assigning EINs, including what you need to know when assigning an EIN to a(n):

    • Sole proprietorship (IRM 21.7.13.5.1)

    • Corporation (IRM 21.7.13.5.2)

    • Partnership (IRM 21.7.13.5.3)

    • Limited liability company (LLC) (IRM 21.7.13.5.4)

    • Non-profit/exempt entity (IRM 21.7.13.5.5)

    • Estate (IRM 21.7.13.5.6)

    • Plan (IRM 21.7.13.5.7)

    • Trust (IRM 21.7.13.5.8)

    • Bankruptcy Estate (IRM 21.7.13.5.9)

    • REMIC (IRM 21.7.13.5.10)

    • UBO/BTO (IRM 21.7.13.5.11)

    • Other/undetermined entity type (IRM 21.7.13.5.12)

    • Foreign entity (IRM 21.7.13.5.13)

    • Household Employer (Fiscal) Agents, under IRC Section 3504 (IRM 21.7.13.5.14)

21.7.13.5.1  (12-27-2012)
EIN Assignment: Sole Proprietorship

  1. This subsection contains information on assigning EINs for sole proprietorships, including:

    • Definition of a sole proprietorship (IRM 21.7.13.5.1.1.)

    • Individuals authorized to receive EINs for sole proprietorship (IRM 21.7.13.5.1.2.)

    • The sole proprietor attempting to file as a corporation (IRM 21.7.13.5.1.3.)

    • Determining whether the sole proprietorship needs an EIN (IRM 21.7.13.5.1.4.)

    • Researching before assigning an EIN to a sole proprietorship (IRM 21.7.13.5.1.5 and IRM 21.7.13.2.2.3; and)

    • CC ESIGN input for sole proprietorship (IRM 21.7.13.5.1.6.)

21.7.13.5.1.1  (10-21-2009)
Definition: Sole Proprietorship

  1. A sole proprietorship is an unincorporated business that is owned by one individual. It is the simplest form of business organization to start and maintain.

    • The business has no existence apart from the owner.

    • Its liabilities are all personal liabilities and the owner undertakes the risks of the business for all assets owned, whether or not used in the business.

    Note:

    For more information on sole proprietorships, see Publication 334, Tax Guide for Small Businesses. Information for farmers can be found in Publication 225, Farmer’s Tax Guide.

  2. A husband and wife are not considered a sole proprietorship, even if they are located in a Community Property state.

21.7.13.5.1.2  (10-01-2008)
Individuals Authorized to Receive EINs: Sole Proprietorship

  1. Established EINs can only be disclosed to:

    • The individual, or

    • Third party authorized by the taxpayer

  2. Before disclosing an EIN to a third party, make sure you have a valid Form 2848, Power of Attorney and Declaration of Representative, Form 8821, Tax Information Authorization , or taxpayer signed Form SS-4. See IRM 21.7.13.3.3 for more information on third party disclosure.

  3. If authorization is not available, inform the third party requesting the EIN that you are going to:

    • Take the information from him/her and assign an EIN, and

    • Send notification (CP 575) of the EIN to the taxpayer's address of record.

    Note:

    If a previously assigned EIN is located, do not disclose this fact to an unauthorized third party.

21.7.13.5.1.3  (10-01-2008)
Sole Proprietor Attempting to File as a Corporation

  1. A sole proprietor cannot file a corporate tax return, unless he/she is doing business through an eligible business, such as a Limited Liability Company (LLC).

  2. If there is an indication that the taxpayer is changing from a sole proprietorship to a corporation, advise the taxpayer that he/she must obtain a new EIN.

  3. If you receive Form 8832 with Form SS-4:

    1. Assign the EIN.

      Note:

      Do not assign 1120 filing requirement.

    2. Notate the EIN on Form 8832.

    3. Forward the forms daily to the appropriate BMF Entity team. See IRM 21.7.13.7.2.4.

    4. Include a request that the Forms 8832 be processed on an expedited basis.

    Note:

    After a classification has been elected, it cannot change for the next five years without a private letter ruling.

21.7.13.5.1.4  (10-01-2010)
Determining the Need for an EIN: Sole Proprietor

  1. Assign an EIN if a legitimate reason exists for the EIN, such as the individual:

    • Is the administrator of a pension plan

    • Is doing business with a federal agency (that is, contracting)

    • Is classified as an independent contractor and has, or plans to have employees

    • Is classified as an independent contractor and is liable for employment or excise tax

    • Is establishing a pension, profit sharing, or retirement plan

    • Is planning to have employees or is liable for employment or excise tax

    • Has household employees

    • Indicates that the EIN is required for business purposes

    • Is concerned about Identity Theft and wishes to use an EIN instead of his/her Social Security Number for business purposes

      Exception:

      Individual Retirement Account (IRA) trusts do not require an EIN unless the trust has to file Form 990-T or Form 1041.

      Note:

      A sole proprietor, who has not previously applied for an EIN, may attempt to open a retirement account, such as a Keogh, which is available to self-employed persons. The bank or financial institution will advise the taxpayer they must have an EIN to do this. The taxpayer may then think they are applying for a 401K or IRA EIN, when in fact, all they need is a sole proprietor EIN. Be alert to this situation, and explain to the taxpayer that you will be assigning them an EIN as a sole proprietor and they should use this EIN for all their sole proprietor business needs, including opening retirement accounts available to self-employed persons.

  2. Assigning an EIN for the sole reason of improving or restoring an individual’s credit or for obtaining a loan is not a legal business purpose.

  3. Follow the criteria in the table below when individual ownership changes within the same year.

    If Then
    An individual’s spouse is added to indicate part ownership in the business Correspond to inform the taxpayer that he/she is required to file as a partnership.

    Note:

    Assign a new EIN since it is a different entity type.

    Caution:

    Taxpayers may be attempting to follow IRC 761 (f) which provides that for tax years beginning after 12/31/2006, a qualified joint venture conducted by a husband and wife who file a joint return is not rated as a partnership for federal tax purposes. See IRM 21.7.13.5.3.1, paragraph (3) for information and instructions.

    A spouse is dropped from the entity (change from partnership to sole proprietorship) Assign a new EIN.
    An individual operates more than one business Only one EIN is needed.
    An individual has both regular employees and household employees Only one EIN is needed. The EIN can be used for both the business and household employees to withhold, report and pay employment taxes on Form 941 or Form 944, Form 940 or Form 1040, Schedule H.
    After a foreclosure, the individual stays in business or opens a new business Do not assign a new EIN. The individual retains his/her original EIN.

21.7.13.5.1.5  (10-01-2005)
Research Before Assigning EIN: Sole Proprietor

  1. Follow the steps in the table below to research an EIN request before assigning a number.

    Step Action
    1 Validate the taxpayer's SSN using:
    • CC INOLE

    • CC NAMEI, and

    • CC NAMES

    See IRM 21.7.13.4.2.
    2 Research the sole proprietor's name and trade name using:
    • CC NAMEB, and

    • CC NAMEE

    See IRM 21.7.13.4.2.
    Examples:
    • CC NAMEB: Falcon,John (name) or Falcon Plumbing,+, (trade)

    • CC NAMEE: John]Falcon (name), or Falcon John

    3 Did you find an EIN?
    • If yes, verify that the EIN is a valid number by researching it on ENMOD and INOLES. See IRM 21.7.13.4.2.

    • If no, proceed to CC ESIGN to assign an EIN.

21.7.13.5.1.6  (07-19-2010)
CC ESIGN Input: Sole Proprietorship

  1. The table below describes the fields and the entries for a sole proprietorship. See IRM 21.7.13.7.3 for general input instructions.

    Field Description of Input Data
    Master-File-IND The Master File Indicator (MFI) is:
    • O if there are no filing requirements, or

    • B if there are filing requirements

    LOC-CD Input the valid two-digit EIN prefix for the campus. See IRM 21.7.13.2.4.

    Note:

    The last two positions of the field display the Area Office Code (00).

    Name-Ctrl The Name Control is the first four characters of the individual's last name.

    Note:

    For more information on inputting BMF Name Control, see Document 7071-A, BMF Name Control Job Aid.

    Primary-Name
    Continuation-of-Primary-Name
    The Primary Name is the true name of the individual (First name, Middle initial, and Last name).
    Example: Input as "JAMES P ]RAIN] JR" :
    Notes:
    • Research INOLE for the true name.

    • Do not reject an application because the information in the system might be incorrect. For example, a husband's and wife's names may have been transposed on their SSNs.

    • Delete prefixes from true names or surnames.

      Example:

      Mr, Mrs, Miss, Rev, Dr, Capt, Hon, Gov


      Important: Do not delete "Mrs" when shown with the full name of the husband (for example, Mrs. Richard Green) or it is a name of indeterminate gender (for example, Mrs. Chris Blue.)

    • Delete suffixes from the true name.

      Example:

      Owner, Agent, Attorney, Proprietor.

      Exception:

      Do not delete suffixes such as DDS, MD, PhD., Jr, Sr, III.

    Sort-Name The Sort Name is the trade name or the doing business as (DBA) name. Enter if different from Line 1.

    Example:

    Sunshine Restaurant

    Note:

    Delete prefixes from the trade name: DBA, TA, AKA.

    See IRM 21.7.13.7.3.6.4.
    Care-Of-Name If the entity applying has a designated person to receive tax information, enter the person's name as the Care-of-Name as indicated by the taxpayer.
    See IRM 21.7.13.7.3.6.5.
    Mail-Street-Or-Foreign-City/Zip Mailing address for the entity's correspondence.
    See IRM 21.7.13.7.3.7.2.
    Mail-City/State/Zip Or-Foreign-Country See IRM 21.7.13.7.3.7.3.
    Location-Street-Address The entity's primary physical location street address.
    See IRM 21.7.13.7.3.7.4.
    Location-City/State/Zip See IRM 21.7.13.7.3.7.5.
    Filing Requirements Input filing requirements as applicable.
    See IRM 21.7.13.7.5.1 for more information on filing requirements.
    Sole-Proprtr-SSN The sole proprietor SSN is the individual's SSN or ITIN from Form SS-4, Line 9a.
    See IRM 21.7.13.3.2.7 for important information on foreign entities.
    Return-ID-CD Enter the code "ZZ" if the entity is a household employer. This generates a CP 575E notice which advises the taxpayer to file Schedule H, if appropriate.
    Business-Operational-Date The date the entity began doing business.
    See IRM 21.7.13.3.2.3 for more details.
    Wages-Paid-Date If the business has employees, the date the business began paying its employees.
    See IRM 21.7.13.3.2.4 for more details.
    Duplicate-Address See IRM 21.7.13.7.3.18.
    Number of Employees The number of employees (if any).
    See IRM 21.7.13.7.3.19.
    Reason-Applied The reason applied (line 10) is entered when the MFI is B or O.
    See IRM 21.7.13.7.3.20 for a complete list of Reason Applied Codes.
    Phone Enter the 10 digit telephone number of the business owner, if provided.
    See IRM 21.7.13.7.3.21.
    Prior-EIN If the MFI is B and the taxpayer has received another EIN for either this or another business, enter Y in this field.
    See IRM 21.7.13.7.3.22.
    Business Location County and State County and State where business is located.
    See IRM 21.7.13.7.3.24.
    Type of Entity
    Type of Entity Remarks
    • Input "01" .

    • Type of Entity Remarks should be blank.

    See IRM 21.7.13.7.3.25.
    Reason for Applying Message Form SS-4, Line 10.
    See IRM 21.7.13.7.3.26.
    Principal Business Activity Checkbox Form SS-4, Line 16
    See IRM 21.7.13.7.3.27 for codes.
    Principal Business Activity Remarks Form SS-4, Line 16 remarks only if "Other" is checked.
    See IRM 21.7.13.7.3.28.
    Principal Merchandise Sold or Service Form SS-4, Line 17, Description of type of business.
    See IRM 21.7.13.7.3.29.
    Prior EIN Form SS-4, Line 18, if present.
    See IRM 21.7.13.7.3.30.
    Remarks
    • The method by which the request was received:

    • "Per Fax,"

    • "Per Mail," or

    • "Per Phone[Caller’s Name and Phone number]" , and

    • Any other pertinent information about the account , if applicable

21.7.13.5.2  (12-27-2012)
EIN Assignment: Corporation

  1. This subsection contains information on assigning EINs for corporations, including:

    • Definition of a corporation (IRM 21.7.13.5.2.1)

    • Individuals authorized to receive EINs for corporations (IRM 21.7.13.5.2.2)

    • Determining whether the corporation needs an EIN (IRM 21.7.13.5.2.3)

    • Research before assigning an EIN to a corporation (IRM 21.7.13.5.2.4 and IRM 21.7.13.2.2.3.)

    • Determining filing requirements for a corporation (IRM 21.7.13.5.2.5), and

    • CC ESIGN input for corporations (IRM 21.7.13.5.2.6)

21.7.13.5.2.1  (10-01-2013)
Definition: Corporation

  1. A corporation is defined as a legal entity or structure created under the authority of the laws of a state consisting of a person or group of persons who become shareholders. The entity's existence is considered separate and distinct from that of its shareholders. Since a corporation is an entity in its own right, it is liable for its own debts and obligations. In forming a corporation, prospective shareholders transfer money, property, or both, for the corporation’s capital stock.

  2. A personal service corporation is an organization in which:

    • The activity involves the performance of services in the field of Health, Law, Engineering, Architecture, Accounting, Actuarial Science, Performing Arts, or Consulting, and

    • Substantially all of the stock is owned by the employees who perform the services.

  3. The table below describes the associated terms and guidelines for a corporation.

    Term Guidelines
    Subsidiary A subsidiary of a corporation:
    • Must have its own EIN

    • Files a separate charter with the Secretary of State

    • Issues its own stock, and

    • Files its own employment tax returns, but has the option to file Form 1120 with the parent corporation or on its own

      Note:

      The subsidiary must have the same tax year as the parent corporation if the subsidiary is filing a consolidated return with the parent.

    Division A division of a corporation:
    • Is an extension of the parent corporation; it is not a separate entity, and

    • Can make Federal Tax Deposit (FTD) payments but the parent corporation's name, address, EIN, etc. must be maintained

    The parent corporation consolidates the tax information of a division with its return.
    Corporate Merger
    • A corporate merger occurs when one corporation buys out another corporation and merges into one.

    • The corporation that does not survive must submit the applicable final returns to close out its account.

    • The surviving corporation continues to use its original EIN.

    Affiliate Each affiliated corporation:
    • Has its own charter, and

    • Can have a different tax year from the parent corporation

    Note:

    If the affiliate files a consolidated return with the parent company, it must have the same tax year.

21.7.13.5.2.2  (10-01-2010)
Individuals Authorized to Receive EINs: Corporation

  1. Established EINs can only be disclosed to individuals who can legally bind the corporation. The authority to bind means the ability to execute agreements that are binding and legally enforceable against the corporation under state law. Individuals who can legally bind the corporation include:

    • President

    • Vice president

    • Corporate secretary

    • Corporate treasurer

    • Chief executive officer

    Caution:

    A corporate officer, who is not the president of a corporation, must be asked if he/she can legally bind the corporation.

  2. EINs cannot be disclosed to a personal secretary or assistant unless he/she can legally bind the corporation. Request one of the following documents in this case:

    • Articles of incorporation stating that he/she is legally bound, or

    • Correspondence stating that he/she is legally bound to receive the EIN on corporation letterhead and signed by the president of the corporation

  3. EINs must not be disclosed to a third party without a valid:

    • Form 2848, Power of Attorney (POA)

    • Form 8821, Taxpayer Information Authorization (TIA), or

    • A taxpayer signed Third Party Designee authorization on the Form SS-4

    Note:

    See IRM 21.7.13.3.3 for more information on third party disclosure.

  4. If the corporation is incorporated in Delaware, then the incorporator is allowed to receive the EIN.

21.7.13.5.2.3  (10-01-2006)
Determining the Need for an EIN: Corporation

  1. Use the information in the table below to determine the need for an EIN for a corporation.

    If Then a new EIN is
    • The entity became a new subsidiary of a corporation

    • The entity is a subsidiary of a corporation and currently uses the parent corporation's EIN

    • The corporation becomes a partnership or sole proprietorship

    • A corporation went out of business and reopened with a new charter

    • A bank foreclosed on a corporation and kept the business open with the bank as the taxpaying entity

      Note:

      In the case of a bank foreclosure, set up the account with the bank as the taxpaying entity and the business name as the DBA.

    Needed.
    • The entity is a division of a corporation

    • After a corporate merger, the surviving corporation uses its existing EIN

    • A corporation declares bankruptcy

    • The business name changes

    • The location changes or new ones are added (stores, manufacturing plants, enterprises, or branches)

    • The entity chooses to be taxed as an S corporation

    • After a corporation reorganization, the only change is either identity, form, or place of organization

    • A corporation is sold and the assets, liabilities, and charters are obtained by the buyer

    Not needed.

21.7.13.5.2.4  (10-01-2010)
Research Before Assigning an EIN: Corporation

  1. Follow the steps in the table below to research an EIN request before assigning a number.

    Step Action
    1 Verify the responsible party's name and SSN, ITIN or EIN using CC INOLE. This information is found on Lines 7a and 7b of Form SS-4. See IRM 21.7.13.4.2.
    See IRM 21.7.13.3.2.7 for important information on foreign entities/persons.
    2 Research the corporation's name:
    • CC NAMEB

    • CC NAMEE


    Examples:
    • CC NAMEB: Falcon & Sons Inc.,+,

    • CC NAMEE: Falcon & Sons Inc.

    3 Did you find an EIN?
    • If yes, verify that the EIN is a valid number. See IRM 21.7.13.4.2.4.

      Note:

      There cannot be more than one active corporation with the same name in the same state. If the taxpayer wishes to use the name of an existing entity, obtain documentation from the taxpayer verifying that the name is registered with the state.

    • If no, proceed to ESIGN to assign an EIN.

21.7.13.5.2.5  (02-20-2013)
Determining Filing Requirement: Corporation

  1. Use the table below to determine the filing requirement for a corporation.

    If the type of entity indicated is Then
    A for-profit corporation Enter the appropriate Form 1120 filing requirement as indicated by the nature of the business. If you can not determine the correct 1120 filing requirement based on the nature of the business, enter 1120–01.

    Note:

    On a phone call, ask the taxpayer what type of Form 1120 he/she will be filing. If the caller is unsure, enter 1120–01.


    See IRM 21.7.13.7.5.2 for more information about corporate filing requirements.
    An S corporation (Sub-chapter S or Sub S)
    • On a phone call, advise the taxpayer to obtain Form 2553 and instructions from the IRS Website at http://www.irs.gov/ , or call 1-800-829-3676 and request the form and instructions by mail.

    • For paper and fax applications, the CP 575 notice instructs the taxpayer to file Form 2553.

    • Taxpayers who apply over the internet are provided with this information during the online session.

    • Do not establish the filing requirement of 1120–02 during EIN assignment.


    If Form 2553 is attached:
    • Notate the EIN on the Form 2553.

    • Route to the appropriate BMF Entity Team.
      See IRM 21.7.13.7.2.4.

    Incorporated in the United States The entity must file Form 1120.

    Note:

    This includes all U.S. Territories except Puerto Rico.

    • A foreign company, and

    • Not incorporated in the U.S. but

    • Does business in the U.S. or has a branch office in the U.S.

    The entity must file Form 1120-F, Income Tax Return of a Foreign Corporation Employer.
    Input a filing requirement of 06.
  2. Organizations of professional persons organized under State Professional Association Acts are treated as a corporation for tax purposes.

  3. For a Personal Service Corporation, input a Form 1120 filing requirement of 19. The FYM must be 12.

    Note:

    Form 1120 FRC of 19 cannot be input via CC BNCHG. If a Personal Service Corporation's filing requirement is incorrect, change it to Form 1120 FRC of 01. The tax return will then update the filing requirement to 19.

21.7.13.5.2.6  (10-01-2013)
CC ESIGN Input: Corporations

  1. The table below describes the fields and the entries for corporations. See IRM 21.7.13.7.3 for general input instructions.

    Field Description of Input Data
    Master-File-IND The Master File indicator (MFI) is B. However, if it is a non-profit corporation without employees, assign MFI of O.

    Note:

    A non-profit entity may be incorporated. This is the case if the taxpayer checks the corporation box on Form SS-4 but also indicates that they are a non-profit organization (IRC § 501(c) or similar statement).

    Loc-Cd Input the valid two-digit EIN prefix for the campus. See IRM 21.7.13.2.4.

    Note:

    The last two positions of the field display the Area Office Code (00).

    Name-Ctrl The Name Control is the first four significant characters of the corporation's name.
    • Disregard the word "the" when followed by more than one word.
      Example
      : The Meadowlark Co.

    • Name Control is MEAD

    • ESIGN input is MEAD

    • Include the word the when it is followed by only one word.
      Example: The Flamingo

    • Name Control is THEF

    • ESIGN input is THEF

    • Use corporate Name Control rules if an individual name contains the following abbreviations:

      Example:


      -PC - Professional Corporation
      -PA - Professional Association
      -SC - Small Corporation, or
      -PS - Professional Service


      Example: John Waxwing PA

    • Use corporate Name Control rules if the organization's name contains the words Fund or Foundation.
      Example: Kathryn Canary Memorial Fund.

    For more information on inputting Name Control, see Document 7071-A, BMF Name Control Job Aid.
    Primary-Name
    Continuation-of-Primary-Name
    The Primary Name is the name of the corporation as it appears on the state charter.
    Important:
    • Delete the word "the" unless it is followed by only one word.

    • Otherwise, do not modify the corporate name.

    • Do not abbreviate, change symbols, or change and to &.

    • The ampersand (&) and the hyphen (-) are considered valid characters in the Primary Name line.

    • Suffixes such as PA, PC, and Inc. indicate a corporate entity and must be input with the corporation's name.

      Note:

      Do not reject a Form SS-4 if the taxpayer did not include a corporate ending in the primary name such as Co, Inc, PC etc.

    Sort-Name The Sort Name is the trade or business name if it is different from the true name.
    The Sort Name is never
    • another corporation or limited liability company (LLC) name, or

    • a corporation officer's name (president, vice-president, etc.).

    When a corporation is in bankruptcy, or a fiduciary is appointed in a state insolvency proceeding, change or add a Sort Name to show the receiver's, trustee's or debtor in possession's name.
    Care-of-Name (If provided)
    See IRM 21.7.13.7.3.6.5 for input requirements.
    Mail-Street-Or-Foreign-City/Zip See IRM 21.7.13.7.3.7.2 for input requirements.
    Mail-City/State/Zip Or-Foreign-Country See IRM 21.7.13.7.3.7.3 for input requirements.
    Location-Street-Address See IRM 21.7.13.7.3.7.4 for input requirements.
    Location-City/State/Zip See IRM 21.7.13.7.3.7.5 for input requirements.
    Filing Requirement Entities that are incorporated with a state are also incorporated for federal tax purposes except that a single member entity may be incorporated for state purposes but disregarded for federal income tax purposes. When an entity, other than a disregarded entity, is incorporated, it must file the appropriate Form 1120, unless it is an exempt organization. See IRM 21.7.13.7.5.2.
    Most exempt organizations that are incorporated must file the appropriate Form 990. (Those that are a church or are affiliated with a church or with a governmental entity are exempt from filing.)

    Note:

    Form 990 filing requirements are not assigned by AM EIN Assistors.

    See IRM 21.7.13.7.6.16
    FYM The Fiscal Year Month (FYM) is the month in which the fiscal year ends for the corporation.
    • Corporations can determine their FYM, unless they are a small business corporation, insurance company, or a personal service corporation. These company types must use a calendar year for the fiscal year (December 31).

    • The taxpayer is responsible for determining if the company is a small business corporation, insurance company, or a personal service corporation.

    • If the FYM is blank and the corporation type is not a small business corporation, insurance company, or a personal service corporation, enter the month preceding the business operation date (BOD).

    • Once a FYM is determined (return filed), the taxpayer can only change it if they meet specific criteria, or by filing Form 1128.

    For information on the specific criteria needed for changing a FYM, see IRM 3.13.2.20, Form 1128 - Application to Adopt, Change or Retain a Tax Year.

    Caution:

    Never change the FYM for an entity on the BMF, unless the taxpayer has explained the reason for the change and it is permissible by law.

    XREF-TIN-Type The cross reference TIN type is used to identify if the number is an EIN or a SSN/ITIN. Enter the number:
    • 0 for SSN/ITIN, or

    • 2 for EIN.

    SSN/ITIN/EIN The SSN/ITIN or EIN is located on line 7b of Form SS-4.
    See IRM 21.7.13.3.2.7 for important information on foreign entities/persons.
    Business-Operational-Date The date the entity began doing business.
    See IRM 21.7.13.3.2.3 for more details.
    Wages-Paid-Date If the business has employees, the date the business began paying its employees.
    See IRM 21.7.13.3.2.4 for more details.
    Number and Type of Employees The number of employees (if any). If "other" employees and Form SS-4, line 14 is "yes" , assign Form 944 filing requirements.
    See IRM 21.7.13.7.3.19.
    Reason-Applied The reason applied (Form SS-4, line 10) is used when the MFI is B or O.
    See IRM 21.7.13.7.3.20.
    Phone Enter the 10 digit telephone number of the business owner, if provided.
    See IRM 21.7.13.7.3.21.
    Prior-EIN If the MFI is B and the taxpayer applied for an EIN for either this or another business, enter Y in this field.
    See IRM 21.7.13.7.3.22.
    Business Location County and State County and state where business is located
    See IRM 21.7.13.7.3.24.
    Type of Entity
    Type of Entity Remarks
    Form SS-4, Line 9a
    See IRM 21.7.13.7.3.25.
    Reason for Applying Message Form SS-4, Line 10
    See IRM 21.7.13.7.3.26.
    Principal Business Activity Checkbox Form SS-4, Line 16
    See IRM 21.7.13.7.3.27.
    Principal Business Activity Remarks Form SS-4, Line 16
    See IRM 21.7.13.7.3.28.
    Principal Merchandise Sold or Service Form SS-4, Line 17
    See IRM 21.7.13.7.3.29.
    Prior EIN If present, Form SS-4, Line 18
    See IRM 21.7.13.7.3.30.
    Remarks
    • The method by which the request was received ("Per Fax," "Per Mail," or "Per Phone[Caller’s Name and Phone number] " ), and

    • Any other pertinent information about the account (such as entity classification change), if applicable

    See IRM 21.7.13.7.3.23.

21.7.13.5.3  (12-27-2012)
EIN Assignment: Partnership

  1. This subsection contains information on assigning EINs for partnerships, including:

    • Definition of a partnership (IRM 21.7.13.5.3.1)

    • Individuals authorized to receive EINs for partnerships (IRM 21.7.13.5.3.2)

    • Determining a filing requirement for a partnership (IRM 21.7.13.5.3.3)

    • Determining whether the partnership needs an EIN (IRM 21.7.13.5.3.4)

    • Research before assigning an EIN to a partnership (IRM 21.7.13.5.3.5 and IRM 21.7.13.2.2.3); and

    • CC ESIGN input for partnerships. (IRM 21.7.13.5.3.6)

21.7.13.5.3.1  (10-01-2013)
Definition: Partnership

  1. A partnership includes a syndicate, group, pool, joint venture or other unincorporated organization, through or by means of which a business, financial operation, or venture is carried on, and which is not a trust, estate or corporation.

    Note:

    Individuals, corporations, trusts, estates, limited liability companies (LLC) and partnerships can be partners within a partnership.

  2. A domestic LLC with at least two members that does not file Form 8832 is classified as a partnership for federal income tax purposes.

    Note:

    If an eligible entity has two members under local law, but one of the members is a disregarded entity owned by the other member, the entity cannot be classified as a partnership and is either taxed as a disregarded entity or can elect to be taxed as a corporation.

  3. HR 2206, Public Law 110-28, Small Business and Work Opportunity Tax Act of 2007, Provision No. 8215 provides that for tax years beginning after 12/31/2006, a "qualified joint venture" conducted by a husband and wife who file a joint return is not treated as a partnership for federal tax purposes. This is not a new entity type. The law simply allows that if a husband and wife are the sole owners of the joint venture, both materially participate in the trade or business, and file a joint individual tax return, they can elect to be treated as a "Qualified Joint Venture" . Each spouse must claim income and expenses on a separate Schedule C or F as sole proprietors. For tax purposes, these spouses are treated as sole proprietors. If the spouses need, or otherwise request EINs, each spouse should apply for one as a sole proprietor.

  4. The table below describes the associated terms for a partnership.

    Term Description
    Partnership Agreement A partnership agreement is a verbal or written agreement whose purpose is to create a partnership. Separate partnerships mean different partnership agreements and require separate EINs.
    Sale or Exchange of 50 Percent or More of the Total Interest in Partnerships The phrase "sale or exchange of 50 percent or more of the total interest in partnerships" is used to determine if the partnership has terminated.

    Note:

    IRC § 708(b)(1)(B) states that a partnership was considered terminated if within a 12 month period there was a sale or exchange of 50 percent or more of the total interest in the partnership's capital and profits. Treasury Regulations 1.708-1 (b) (4) Example (ii) and 301.6109-1 (d) (2) (iii) provides that a partnership that is terminated under IRC § 708(b)(1)(B) shall retain the EIN of the terminated partnership.

    Schedule K-1
    • The partnership uses Schedule K-1 to report each partner's share of the partnership’s income, credits, deductions, etc.

    • All Partnerships must complete Schedule K and Schedules K-1 and attach them to Form 1065.

    • Partners should keep the K-1 with their individual tax records.

21.7.13.5.3.2  (10-01-2007)
Individuals Authorized to Receive EINs: Partnerships

  1. Established EINs can be disclosed to:

    • A responsible and duly authorized partner (including general and limited partners), or

    • An authorized third party.

    Note:

    Tax returns and return information can only be released to individuals as outlined in IRM 11.3.2.4.2.

  2. EINs must not be disclosed to a third party without a valid Form 2848, Form 8821 or a signed Form SS-4. See IRM 21.7.13.3.3 for more information on third party disclosure.

21.7.13.5.3.3  (10-01-2013)
Determining Filing Requirement: Partnership

  1. Form 1065, U.S. Return of Partnership Income is filed:

    • To report the income, deductions, gains, losses, etc. from the operation of a partnership

    • By all domestic partnerships and all foreign partnerships that either engage in a trade or business effectively connected with the United States, or derive income from sources in the United States, and

    • By religious and apostolic organizations that are exempt from income tax under IRC Section 501(d).

  2. The return is filed annually and is due on the 15th day of the:

    • Fourth month following the close of its tax year for domestic partnerships, and

    • Sixth month following the close of its tax year for partnerships where partners are all nonresident aliens.

  3. Use the table below to determine the filing requirement for a partnership.

    If Then
    The entity type is a
    • partnership

    • joint venture

    Caution:

    The term "joint venture " in this case is not the same as the "qualified joint venture" above. See IRM 21.7.13.5.3.1.

    Enter a Form 1065 filing requirement of 1.
    Form SS-4 states tenants in common Establish the entity with a Form 1065 filing requirement of 1.

21.7.13.5.3.4  (10-01-2006)
Determining the Need for an EIN: Partnerships

  1. Use the table below to determine the need for an EIN for partnerships.

    If any of the following criteria is met Then a new EIN is
    • The partnership requests an EIN and does not already have one

    • A partnership incorporates

    • One partner takes over and operates as a sole proprietorship

    • A partnership ends and a new one is begun

      Exception:

      Partnerships terminated under IRC § 708(b)(1)(B) do not require a new EIN.

    • A bankrupt partnership establishes a liquidating trust that is a separate entity for tax purposes. See paragraph (2) below.

    Needed.
    • A partnership declares bankruptcy

    • The partnership name changes, or

    • The location of the partnership changes or locations are added

    Not needed.
  2. A bankrupt partnership that establishes an escrow account, settlement fund, or similar fund to liquidate or distribute assets must obtain a new EIN for that entity.

    Note:

    Correspondence may be needed for bankrupt partnerships that establish an escrow account, settlement fund, or similar fund to liquidate or distribute assets.

21.7.13.5.3.5  (10-01-2006)
Research Before Assigning an EIN: Partnership

  1. Follow the steps in the table below to research an EIN request before assigning a number.

    Step Action
    1 Validate the partner's SSN/ITIN using:
    • CC INOLE

    • CC NAMEI

    • CC NAMES

    If the partner is an entity and not an individual, validate its EIN using:
    • CC INOLE

    • CC NAMEB

    • CC NAMEE

    Note:

    See IRM 21.7.13.3.2.7 for important information on foreign entities/persons.

    2 Research the partnership's name using:
    • CC NAMEB, and

    • CC NAMEE


    Examples:
    • CC NAMEB: Gazelle and Giraffe,+,

    • CC NAMEE: Gazelle and Giraffe Ptrs

    • CC NAMEI: Giraffe, John

      Note:

      Use the partners' names and DBA when researching.

    3 Did you find an EIN?
    • If yes, verify that the EIN is a valid number. See IRM 21.7.13.4.2.4.

    • If no, proceed to CC ESIGN to assign an EIN.

21.7.13.5.3.6  (07-19-2010)
CC ESIGN Input: Partnerships

  1. The table below describes the fields and the entries for partnerships. See IRM 21.7.13.7.3 for general input instructions.

    Field Description of Input Data
    Master-File-Ind. The Master File Indicator (MFI) is B
    Loc-Cd Input the valid two-digit EIN prefix for the campus. See IRM 21.7.13.2.4.

    Note:

    The last two positions of the field display the Area Office Code (00).

    Name -Ctrl The Name Control is the first four characters of the:
    • Business (DBA) or trade name
      Example : Rose Restaurant, or

    • First partner's last name.
      Examples : Burgandy, Olive & Cobalt, Ptrs or
      Mary Smith and Jane Doe

    For more information on inputting Name Control, see Document 7071-A, BMF Name Control Job Aid.

    Exception:

    The online EIN application cannot distinguish a partner's name (first or last name) from a business (trade) name. Therefore, corporate name rules (first four characters entered in the legal name field) are applied to all partnership entities established over the internet.

    Primary-Name
    Continuation-of-Primary-Name
    The Primary Name is the legal or true name of the partnership, or the list of partners.
    • This is usually the business name. However, if the taxpayer indicates an individual name and it is different from the business or trade name, use the individual name.

    • If a partnership name is not provided, use the partner's name(s) followed by the abbreviation PTR.

    • If it is not possible to list all the partners, list the maximum number of names and add the phrase Et al ptr.

    • If there is only one partner's name listed, add the phrase ET AL PTR. Do not delete suffixes such as DDS, MD, Ph.D., Jr., Sr., III.

    Sort-Name The Sort Name is the doing business as (DBA) name, if it is different from the true or legal name.

    Note:

    If the taxpayer supplies a general partner's or a tax partner's name and there is not a DBA name, enter the individual's name followed by the words gen ptr or tax ptr.

    Care-of-Name The In-Care of Name is the name of a general or tax partner if it is provided, and not used as the Sort Name.

    Note:

    If another entity is listed as a partner (for example, a trust, a corporation, a LLC, or a partnership), enter it as the In-Care of Name.

    Note:

    If the Primary Name is identical to the In-Care of Name, this field is not required.

    Mail-Street-Or-Foreign-City/Zip See IRM 21.7.13.7.3.7.2 for input requirements.
    Mail-City/State/Zip Or-Foreign-Country See IRM 21.7.13.7.3.7.3 for input requirements.
    Location-Street-Address See IRM 21.7.13.7.3.7.4 for input requirements.
    Location-City/State/Zip See IRM 21.7.13.7.3.7.5 for input requirements.
    Filing Requirements Assign Form 1065 filing requirements for all partnership entities. Also, assign any additional filing requirements, as appropriate.

    Note:

    Form 1065 is not compatible with Form 1120, Form 1041, or Form 1066 filing requirements.


    For additional information on Form 1065 filing requirements, see IRM 2.4.8, IDRS Terminal Input, CC ESIGN.
    FYM The fiscal year month (FYM) is the month in which the fiscal year ends for the partnership. If there is no FYM indicated, input FYM 12.
    See IRM 21.7.13.7.3.10.
    XREF-TIN-Type The cross reference TIN type is used to identify if the number is an EIN, SSN or an ITIN. Enter the number:
    • 0 for SSN/ITIN, or

    • 2 for EIN.

    SSN/ITIN/EIN The SSN, ITIN or EIN is located on Line 7b of Form SS-4.
    See IRM 21.7.13.3.2.7 for important information on foreign entities/persons.
    Notice-Information-Cd If a notice other than a CP 575 is required, input the appropriate code.
    See IRM 21.7.13.7.3.13 for a complete list of codes.
    Business-Operational-Date The date the entity began doing business.
    See IRM 21.7.13.3.2.3 for more details.
    Wages-Paid-Date If the business has employees, the date the business began paying its employees.
    See IRM 21.7.13.3.2.4 for more details.
    Number and Type of Employees The number of employees (if any). If Line 14 is "yes " , assign Form 944 filing requirements.
    See IRM 21.7.13.7.3.19.
    Reason-Applied The reason applied (Form SS-4, Line 10) is used when the MFI is B or O.
    See IRM 21.7.13.7.3.20 for a complete list of Reason Applied Codes.
    Phone The 10 digit telephone number of the business owner, if provided.
    See IRM 21.7.13.7.3.21.
    Prior-EIN If the MFI is B and the taxpayer applied for an EIN for either this or another business, enter Y in this field.
    See IRM 21.7.13.7.3.22.
    Business Location County and State County and state where principal business is located
    See IRM 21.7.13.7.3.24.
    Type of Entity
    Type of Entity Remarks
    Form SS-4, Line 9a
    See IRM 21.7.13.7.3.25.
    Reason for Applying Message Form SS-4, Line 10
    See IRM 21.7.13.7.3.26.
    Principal Business Activity Checkbox Line 16, Checkbox .
    See IRM 21.7.13.7.3.27.
    Principal Business Activity Remarks Form SS-4, Line 16
    See IRM 21.7.13.7.3.28.
    Principal Merchandise Sold or Service Form SS-4, Line 17
    See IRM 21.7.13.7.3.29.
    Prior EIN Form SS-4, Line 18, if present
    See IRM 21.7.13.7.3.30.
    Remarks
    • The method by which the request was received ("Per Fax," "Per Mail," or "Per Phone" [Caller’s Name and Phone number]), and

    • Any other pertinent information about the account , if applicable

    See IRM 21.7.13.7.3.23.

21.7.13.5.4  (10-01-2008)
EIN Assignment: Limited Liability Company (LLC)

  1. This subsection contains information on assigning EINs for limited liability companies (LLCs), including:

    • Definition of a limited liability company (IRM 21.7.13.5.4.1)

    • Determining tax classification and filing requirements (IRM 21.7.13.5.4.2)

    • LLC filing as a corporation (IRM 21.7.13.5.4.2.1)

    • LLC - New Regulations Effective 1/1/2008 and 1/1/2009 (IRM 21.7.13.5.4.2.2)

    • Why two EINs are assigned to a single member LLC (IRM 21.7.13.5.4.3)

    • Determining the need for an EIN: Single member LLC (IRM 21.7.13.5.4.3.1)

    • Individuals authorized to receive EINs: LLC (IRM 21.7.13.5.4.4)

    • CC ESIGN input for LLCs (IRM 21.7.13.5.4.5)

21.7.13.5.4.1  (10-01-2006)
Definition: LLC

  1. A limited liability company (LLC) is an entity organized under the laws of a state or foreign country that:

    • Has the limited liability feature of the C corporation

    • Is formed by filing articles of organization with the individual state’s Secretary of State office, and

    • Can have two or more members or a single member

      Note:

      For federal income tax purposes, an LLC is not recognized as an entity type.

  2. A single-member domestic LLC that accepts the default classification of disregarded entity, and wants an EIN for filing employment tax returns or non-federal purposes, should:

    • Check the Other box on Line 9a, and

    • Write "Disregarded Entity" or "Disregarded Entity-Sole Proprietorship" in the space provided on Line 9a.

  3. A multi-member domestic LLC, that accepts the default classification, should check the "partnership" box. A multi-member domestic LLC, that will be filing Form 8832 or Form 2553, should check the "corporation" box and write in "single-member" or "multi-member" below the form number entry line.

  4. There cannot be more than one active LLC with the same name in the same state. If the taxpayer wishes to use the name of an existing entity, obtain documentation from the taxpayer verifying that the name is registered with the state.

21.7.13.5.4.2  (10-01-2007)
Determining Tax Classification and Filing Requirements: LLC

  1. For federal income tax purposes:

    • An LLC can be taxed as a corporation, partnership, or be disregarded as an entity separate from its owner, and

    • The number or type of members and existing characteristics determines the correct filing requirement

    Note:

    The July 2007 revision of Form SS-4 added three questions on Line 8 specifically for LLCs, which allows EIN assignment employees to correctly assign the default filing requirements and populate the LLC>IND field on CC ESIGN.

  2. It is the taxpayer’s responsibility to determine the correct entity classification. However, a partnership must have more than one member.

    Note:

    For taxpayers using prior revisions of Form SS-4, if there is no indication of the correct entity classification of the LLC, attempt to contact the taxpayer by telephone. If unable to resolve the classification of the LLC, assign the multi member default classification of Form 1065.

  3. For more information on determining if a company is an LLC, see Sections 301.7701-1 through 301.7701-3 of the Procedure and Administration Regulations.

  4. A domestic LLC with two or more members is treated as a partnership by default. A domestic LLC can file Form 8832, Entity Classification Election, to avoid the default classification and elect to be classified as an association taxable as a corporation.

  5. An LLC can also elect to be treated as an S corporation. For the S corporation status to be approved, Form 2553 must be received in the BMF Entity function according to the BMF Entity State Mapping chart. See IRM 21.7.13.7.2.4. ( Form 8832 does not have to be filed if the LLC only wants to become an S corporation.)

  6. Per Rev. Proc. 2002-69, a husband and wife who are the sole owners of an LLC and reside in a community property state can choose whether they are treated as a partnership or disregarded entity. In either case, since the husband and wife are joint owners of the LLC, tax information related to the LLC can be discussed with either spouse.

    Note:

    Community property states include: Arizona, California, Idaho, Louisiana, New Mexico, Nevada, Texas, Washington, and Wisconsin. Publication 555, Community Property, and IRM 25.18.1, Community Property , both contain additional information on community property laws.

21.7.13.5.4.2.1  (01-13-2009)
LLC Filing as a Corporation

  1. If the taxpayer has indicated Corporation on Line 9a, advise the taxpayer they must file Form 8832 to elect to be classified as an association taxable as a corporation, or Form 2553 under Rev. Proc. 2004–48 to elect S corporation status. If the taxpayer has a valid Power of Attorney, Taxpayer Information Authorization, or Third Party Designee, it is not necessary to provide this information.

    Note:

    For EIN phones, advise taxpayer during the application process. Do not send Letter 147C to taxpayers applying by paper or fax since the CP 575 notice provides this information.

21.7.13.5.4.2.2  (01-13-2009)
LLC - Regulations Effective 1/1/2008 and 1/1/2009

  1. Final regulations changing the treatment of single-member LLCs (who have not filed an election to be taxed as a corporation) for employment and excise tax liabilities were issued on August 16, 2007. For certain excise tax liabilities (reported on Form 730, Form 2290, Form 11-C, and some Form 720 liabilities) incurred after January 1, 2008, the single-member LLC is treated as a separate entity and is required to report excise taxes in the name and EIN of the LLC. For federal income tax purposes, the LLC is still disregarded. For employment tax liabilities incurred after January 1, 2009, the LLC will be treated as a separate entity and must report employment taxes in the name and EIN of the LLC. Again, the LLC will still be disregarded for federal income tax purposes.

  2. The changes effective January 1, 2008 required limited changes to procedures for EIN assignment. However, single-member LLCs without employees will not be discouraged from applying for an EIN, as they may require one for the reporting and payment of excise taxes.

  3. Single-member LLCs who began paying employees before January 1, 2009 will need two EINs assigned to them. Assign one EIN to the owner (if they do not have one previously assigned) and assign another EIN to the LLC.

  4. Single-member LLCs who will begin paying employees after January 1, 2009 will no longer require two EINs (one for the owner and one for the LLC). One EIN will be assigned to the LLC with the single-member's TIN in the SSN-ITIN-EIN> field.

21.7.13.5.4.3  (01-10-2008)
Why Two EINs Are Assigned to a Single Member LLC for Certain Tax Periods

  1. Two EINs are assigned to single-member LLCs with employees during tax periods ended prior to January 1, 2009 because:

    • A single member LLC that is a disregarded entity (i.e. it has not filed an election to be taxed as a corporation) cannot be an employer. The owner is the employer of record. The employment tax regulations require that an employer must have an EIN.

    • Notice 99-6 allows a single member LLC that is a disregarded entity to calculate, report and pay employment taxes under the name and EIN of the LLC or the name and EIN of the owner. It was published at the request of practitioner groups who complained that without the option, disregarded entities would have to run parallel accounting systems for state and federal employment taxes. The state never disregarded the entity for tax purposes.

    Note:

    For tax periods beginning on or after January 1, 2009, Notice 99-6 is obsolete and employment taxes must be reported in the name and EIN of the LLC.

  2. If the taxpayer chooses to calculate, report, and pay their employment taxes under the LLC name for tax periods ended prior to January 1, 2009, assign two EINs (one for the owner and one for the disregarded entity). The taxpayer/preparer must make a concerted effort not to get the two confused. The two EINs will generate separate CP 575 notices. When processing fax, paper, or internet fallout applications, issue Letter 147C, advising that the owner EIN is just for cross-referencing purposes.

  3. If the taxpayer chooses to calculate, report and pay their employment tax liabilities for tax periods ended prior to January 1, 2009 under the owner's name, and they are filing Form SS-4 to get an EIN for an LLC (for banking purposes or because their state requires an EIN for the LLC), they should not check "hired employees" in box 10. Instead, they should check banking purposes, or whatever is appropriate.

  4. See IRM 21.7.13.5.4.2.2 for changes effective January 1, 2009.

21.7.13.5.4.3.1  (10-01-2013)
Determining the Need for an EIN: Single-Member LLC

  1. By default, a domestic LLC with only one member is:

    • Disregarded as an entity separate from its owner for federal income tax purposes, and

    • Must include all of its income and expenses on the owner’s tax return

    • Disregarded as an entity separate from its owner for all other federal tax purposes except for employment taxes on wages paid on or after 1/1/2009 and certain excise taxes for periods beginning on or after 1/1/2008.

  2. Research NAMEB and NAMEE to determine if the LLC had a previous EIN.

  3. Use the table below to assign the EIN(s) and filing requirements:

    If Then
    The LLC is disregarded as an entity separate from its owner (for federal income tax purposes), and the owner is an individual (and does not have employees)
    • Assign the EIN.

    • Establish any known excise tax filing requirements (2290, 730, 11-C) on the LLC EIN if the BOD is 1/1/2008 or later.

    Note:

    The owner of the disregarded LLC is responsible for all federal income tax filings (Form 1040 including all schedules, Form W-9, Form 1099, etc) using his/her SSN or ITIN. See IRM 21.7.13.5.4.2.2 for changes effective 1/1/2008.

    The owner is an entity that is not an individual (for example, corporation, trust, estate, partnership, etc.) and does not have employees
    • Assign the EIN

      Note:

      See IRM 21.7.13.5.4.2.2 for changes effective 1/1/2008.

    • Input the owner's name in the in-care-of field followed by MBR or Single/Sole MBR.

    • Establish any known excise tax filing requirements (Form 2290, Form 730, Form 11-C) on the LLC EIN if the BOD is 1/1/2008 or later.

    The LLC is disregarded (individual owner or other entity), and has employees during tax periods ended prior to January 1, 2009 The owner must have a separate EIN for the LLC, unless they choose to file under the owner's name and TIN.
    • In the case of an individual, they would use the sole proprietor EIN.

    • In the case of an entity, they would use the EIN of the single owner (ex. Corp).

    See IRM 3.13.2.25, Domestic Limited Liability Company (LLC) for more information.
    If the owner chooses to obtain a separate EIN for the LLC, then the individual owner must have an EIN that will in turn be used as a cross-reference for the LLC EIN. Follow the four steps below:
    1. Assign an EIN to the owner, if they do not already have one.

    2. Assign the second EIN to the LLC.

    3. Establish filing requirements for employment taxes for the owner's EIN or LLC's EIN, as indicated by the taxpayer for tax periods ended prior to 1/1/2009.

    4. Inform the taxpayer by sending Letter 147C, indicating that he/she has been assigned two EINs; one for the owner, and one for the LLC.

    Note:

    Third Party Designees applying for an EIN for a single-member LLC with employees are authorized to receive both the owner's EIN and the LLC's EIN.

    Exception:

    See IRM 21.7.13.5.4.2.2 for changes effective 1/1/2009.

    The LLC has employees for tax periods beginning on or after January 1, 2009 and the owner is an individual
    • Assign the EIN.

    • Establish any known excise tax filing requirements (Form 2290, Form 730, Form 11-C) on the LLC EIN.

    • Establish filing requirements for employment taxes (94X) on the LLC EIN.

    Note:

    The owner of the disregarded LLC is responsible for all federal income tax filings (Form 1040 including all schedules, Form 1099, Form W-9, etc.) using his/her SSN or ITIN. See IRM 21.7.13.5.4.2.2 for changes effective 1/1/2008 and 1/1/2009.

    The LLC has employees for tax periods beginning on or after January 1, 2009 and the owner is an entity that is not an individual
    • Assign the EIN.

    • Establish any known excise tax filing requirements (Form 2290, Form 730, Form 11-C) on the LLC EIN.

    • Establish filing requirements for employment taxes (94X) on the LLC EIN.

    Note:

    The owner of the disregarded LLC is responsible for all other federal tax filings (Form 1065, Form 1120, Form 1099, Form W-9, etc.) using the EIN for the entity. See IRM 21.7.13.5.4.2.2 for changes effective 1/1/2008 and 1/1/2009.

21.7.13.5.4.4  (10-01-2008)
Individuals Authorized to Receive EINs: LLC

  1. Tax information must be disclosed in conformance with the Federal tax treatment of the LLC. See IRM 11.3.2.4, Persons Who May Have Access to Returns and Return Information Pursuant to IRC 6103(e). For AM EIN assignment purposes, default classification rules for LLCs apply. See the table below for additional information.

    Note:

    A third party, authorized by the taxpayer, would also be authorized to receive the EIN.

    If the LLC is a The Default Tax Classification is Then
    Multi-Member Partnership Any of the LLC members (who are treated as partners for Federal tax purposes) can receive the EIN.
    Single Member
    (Owned by an individual)
    Disregarded Entity for Federal Income Tax Purposes The individual owner is authorized to receive the EIN.
    Single Member
    (Owned by a business entity)
    Disregarded Entity for Federal Income Tax Purposes The EIN can be disclosed to a person who is authorized to receive tax information for that business entity.

    Example:

    If the LLC is owned by The Flamingo Corp, follow the rules for disclosure to corporations.

21.7.13.5.4.5  (06-06-2013)
CC ESIGN Input: LLC

  1. The table below describes the fields and the entries for LLCs. See IRM 21.7.13.7.3 for general input instructions.

    Field Description of Input Data
    Master File Ind. MFI is O if no filing requirements; B if filing requirements.
    Loc-Cd Input the valid two-digit EIN prefix for the campus. See IRM 21.7.13.2.4.

    Note:

    The last two positions of the field display the Area Office Code (00).

    Name-Ctrl The Name Control is the first four characters of the LLC name. Follow corporate name control rules if "the" is the first word in the LLC name. See IRM 21.7.13.5.2.6.
    Primary Name The Primary Name is the name of the LLC as it appears on the articles of organization by the state.
    • Delete the word "the" , unless it is followed by only one word.

    • Otherwise, do not modify the LLC's name.

    • Do not abbreviate, change symbols, or change "and" to "&"

    • The ampersand (&) and the hyphen (-) are considered valid characters in the Primary Name line.

    • Suffixes such as LLC, LC, and PLLC (or LLP for a limited liability partnership) indicate a limited liability company and are input with the LLC’s name.

      Note:

      Do not add an LLC suffix to the name line if one is not present.

    Sort Name The Sort Name is the doing business as (DBA) name, if it is different from the true or legal name.

    Note:

    If the taxpayer supplies a member’s name and there is not a DBA name, enter the individual's name followed by the abbreviations, mbr or single (or sole) mbr. Never input LLC name in the sort line.

    In-Care-of- Name The In-Care of Name is the name of the member or single member if it is provided, and was not used as the Sort Name.
    • If another entity is listed as a member (for example, a trust, a corporation, another LLC or a partnership), enter it as the In-Care-of-Name followed by mbr or single (or sole) mbr.

    • If the Primary Name is identical to the In-Care-of-Name, this field is not required.

    Mail-Street-Or-Foreign-City/Zip See IRM 21.7.13.7.3.7.2.
    Mail-City/State/Zip Or-Foreign Country See IRM 21.7.13.7.3.7.3.
    Location-Street- Address See IRM 21.7.13.7.3.7.4.
    Location-City/State/Zip See IRM 21.7.13.7.3.7.5.
    LLC>IND Three LLC questions were added to the July 2007 revision of Form SS-4 (Lines 8a thru 8c). Information from Line 8b is used to populate the new LLC>IND field on CC ESIGN. Valid entries on CC ESIGN are:
    S - Single Member LLC or
    M - Multi Member LLC.
    Filing Requirements See IRM 21.7.13.5.4.2.
    FYM The fiscal year month (FYM) is the month in which the fiscal year ends for the multi-member LLC. If there is no FYM indicated, default to "12"

    Reminder:

    A single member LLC does not need an FYM.

    XREF-TIN-Type The cross reference TIN type is used to identify if the number is an EIN, a SSN or an ITIN.
    Enter the number:
    • 0 for SSN/ITIN, or
    • 2 for EIN
    SSN/ITIN/EIN The SSN/ITIN or EIN is located on Line 7b of the Form SS-4 .
    See IRM 21.7.13.3.2.7 for important information on foreign entities/persons.
    Notice-Information-Cd If a notice other than a CP 575 is required, input the appropriate code.
    See IRM 21.7.13.7.3.13 for a complete list of codes.
    Business Operational Date The date the entity began doing business.
    See IRM 21.7.13.3.2.3.
    Wages-Paid- Date If the business has employees, the date the business began paying its employees.
    See IRM 21.7.13.3.2.4.
    Number and Type of Employees The number of employees (if any). If "other" employees and Line 14 are "yes" , assign Form 944 filing requirements.
    Reason Applied The reason applied ( Form SS-4, Line 10) is used when the MFI is B or O.
    See IRM 21.7.13.7.3.20 for a complete list of Reason Applied Codes.
    Phone The 10 digit telephone number of the business owner, if provided.
    Prior-EIN If the MFI is B and the taxpayer applied for an EIN for either this or another business, enter Y in this field.
    Business Location County and State County and State where business is located
    See IRM 21.7.13.7.3.24.
    Type of Entity
    Type of Entity Remarks
    Form SS-4, Line 9a
    See IRM 21.7.13.7.3.25.
    Reason for Applying Message Form SS-4, Line 10
    See IRM 21.7.13.7.3.26.
    Principal Business Activity Checkbox Form SS-4, Line 16
    See IRM 21.7.13.7.3.27.
    Principal Business Activity Remarks Form SS-4, Line 16
    See IRM 21.7.13.7.3.28.
    Principal Merchandise Sold or Service Form SS-4, Line 17
    See IRM 21.7.13.7.3.29.
    Prior EIN Form SS-4, Line 18
    See IRM 21.7.13.7.3.30.
    Remarks The method by which the request was received - Per Fax, Per Mail, or Per Phone (Caller’s Name and Phone number), and any other pertinent information about the account.

21.7.13.5.5  (10-01-2005)
EIN Assignment: Non-Profit/Exempt

  1. This subsection contains information on assigning EINs for non-profit and exempt organizations, including:

    • Definition of a non-profit and exempt organization (IRM 21.7.13.5.5.1.)

    • Individuals authorized to receive EINs for non-profit and exempt organizations (IRM 21.7.13.5.5.2.)

    • Research before assigning an EIN to a non-profit and exempt organization (IRM 21.7.13.5.5.3.)

    • Determining tax classification and employment codes (IRM 21.7.13.5.5.4.)

    • CC ESIGN input for non-profit/exempt organizations (IRM 21.7.13.5.5.5.); and

    • Group Exemption Numbers (IRM 21.7.13.5.5.6.)

21.7.13.5.5.1  (04-04-2007)
Definition: Non-Profit/Exempt

  1. Non-profit status is a state law concept. Non-profit status may make an organization eligible for certain benefits, such as state sales, property, and income tax exemptions. Although most federal tax-exempt organizations are non-profit organizations, organizing as a non-profit organization at the state level does not automatically grant the organization exemption from federal income tax. To qualify as exempt from federal income taxes, an organization must meet requirements set forth in the Internal Revenue Code.

  2. Non-profit organizations include both tax exempt organizations and government entities. The following list is an example of some of these entities. This list is not all-inclusive:

    • Private foundations

    • Religious organizations

    • Educational organizations

    • Charitable organizations

    • Employee associations

    • Veterans organizations

    • Business leagues

    • State-chartered credit unions

    • Teachers' retirement fund associations

    • Federal government/military

    • State/local government

    • Indian tribal governments/enterprises

    • Farmers’ cooperative

    • Social clubs

  3. For more information on non-profit and exempt organizations, see IRM 3.13.12, Exempt Organization Account Numbers.

21.7.13.5.5.2  (10-01-2008)
Individuals Authorized to Receive EINs: Non-Profit/Exempt

  1. The EIN of a tax exempt organization which is not publicly available under IRC § 6104 may be disclosed to any person legally authorized to act for the organization.

  2. Organizations can have varying names for titles of officers. The key is to establish that the person with whom you are in contact is not an outside third party and is legally authorized to act on behalf of the organization.

  3. Ask the caller for their name, SSN/ITIN, and DOB. Also ask the following question: "Are you a current officer legally authorized to act on behalf of the organization/plan?"

  4. EINs must not be disclosed to a third party without a valid Form 2848, Form 8821, or taxpayer signed Form SS-4. See IRM 21.7.13.3.3 for more information on third party disclosure.


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