EIN for California Foreign LLC – How to Obtain EIN For Foreign Entity


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To obtain EIN for California foreign LLC one has to follow a few steps. Limited Liability Companies are easier to form than other structures of business. However, it is a bit tricky for the LLCs to form a foreign LLC in any of the states. There can be some restrictions for the Foreign LLCs to form a California LLC. Take a look at this article to know about how to obtain EIN for your foreign LLC. It will answer all your questions related to EIN, including the procedure for a foreign entity to obtain EIN, the filing cost, etc. 

What is a Foreign Limited Liability Company?

An LLC is always formed in accordance with the state rules. The state where the LLC is formed is often referred to as the main state for the LLC. It is where the LLC has its main operational center. When the LLC business members are trying to expand the LLC  & wish to form it in some other states as well, the LLC is a foreign entity in the new state. The LLC is formed in the new state will be referred to as “Foreign Entity” or  “Foreign Corporation” or “Foreign LLC.” Forming the California Foreign LLC is easier & involves obtaining an EIN.

What is an EIN (Employer Identification Number)?

An EIN or Employer Identification Number works as a Social Security Number for your business. An EIN is a unique 9 digit identification code issued to businesses, by the Internal Revenue Service (IRS) of the U.S.S., for tax filing & reporting purposes.

Are EIN, FTIN & FEIN the same?

An Employer Identification Number (EIN) is also called a Federal Employer Identification Number (FEIN) or a Federal Tax Identification Number (FTIN). So, there is no difference between these three.

Why Does a Business Need EIN?

An LLC will require EIN for the following reasons:

  1. To file Tax returns – EIN makes it easy to file the tax returns with the IRS. The IRS uses EIN to supervise all the business finances of the LLC. 
  2. To Hire Employees – To hire employees in the LLC, an Employer will need the EIN. EIN lets the employers set the payrolls of the employee fo every month. IRS tracks the employee’s payroll taxes with the help of the EIN.
  3. To maintain the corporate veil – In an event where someone has sued the LLC or has filed a lawsuit against it, the EIN protects members’ assets. EIN is an essential part of the company’s corporate veil, which differentiates the business entity from its members.
  4. To protect the individual Identity of the member – The Limited Liability Company uses EON for all its taxation & finances. Nowhere in the financial process does an LLC use an individual’s Social Security Number; hence the Identity of individual members is kept safe.
  5. To open a business bank account – Without the EIN, an LLC can’t open a business account. It is essential to get an EIN even for the business credits & business licenses. 

When Does IRS Ask for EIN (Employer Identification Number)?

The taxation documents & reports are filed with the IRS, which requires an LLC about its EIN in the following circumstances.

  • An EIN is mandatory for an LLC with employees for tax filing & tax returns.
  • If the LLC is a multi-member business entity, EIN is required for drawing the partnership return files.
  • An EIN is also asked for excise tax filing.

EIN for a Foreign Entity or Foreign LLC

If someone is a foreign person or if the LLC is a foreign LLC, EIN allows them to start the LLC even without the Social Security Number. EIN allows the member of the foreign LLC to collect a payment, distribute the cash in the company & out of the company, hire employees & report or file taxes.

How to Obtain EIN for a Foreign LLC or a Foreign-Owned Corporation? 

Following is a step-by-step guide for obtaining an EIN for a Foreign LLC:

  1. Eligibility – Any person applying for the EIN must have a valid Taxpayer Identification Number, e.g., SSN or ITIN; only then can he apply for EIN.
  2. FORM SS-4 – If a foreign entity does not have a Tax Identification Number, it will have to fill-up the Form SS-4, an EIN application. This form is for foreign applicants who do not have a social security number or a physical address
  3. Filing the form with the required information – To be able to apply for the EIN, the following information has to be filled out correctly in the application form:  
    – Legal Name & Address of the Business
    –  The type of Business Entity
    – Reason for the application for an EIN- The name of the country where the business is incorporated
    – Number of employees
    – The industry in which the LLC does its business
    – Accounting Information
  4. Ways to apply for EIN California
    • Online – An EIN can be obtained by applying online on the IRS website.
    • By phone – A foreign entity or LLC can apply for  EIN by calling on 267-941-1099, which is NOT a toll-free number.
    • By Fax – An EIN can also be obtained by fax. The LLC willing to obtain the EIN can fax Form SS-4 to 304-707-9471
    • By Mail – A completed form can be mailed to the Internal Revenue Service (IRS), Attn: EIN Operation, Cincinnati, OH 45999.

Restrictions in Business For Foreign Entities in California

There are some restrictions in conducting business in California. Here are some of the rules/guidelines to follow while you start a foreign LLC in California.

Transacting Business in California

Any foreign business LLC that has a physical presence or a similar nexus in the State of California shall collect State Sales tax in accordance with the State regulations. For instance, if the foreign business LLC owns a warehouse, a store, or an office in the State of California or has a sales representative in the State in pursuance of their business operations, then the foreign enterprises are required to collect state sales taxes. 

Registering The Business

For registration of the foreign LLC, the business entity must file an Application to Register a Foreign Limited Liability Company (LLC) and a Certificate of Qualification with the Secretary of State to register your business in California. All of the information included in the application therein shall become a public record.

The foreign business LLCs shall also identify their registered agent in the State to act as their official person to receive any communication from the Secretary of State office. The registered agent is the person who accepts and distributes legal documents on behalf of the LLC. 

Effect Of Non-Registration

If a Foreign LLC is not registered with the California Secretary of State in accordance with the State Laws, then it may suffer through following consequences:

  • Such a business LLC shall not have a right to legal representation in the Court of Law in the State of California. 
  • Any costs and penalties that may arise due to non-registration of the business shall be borne by the business LLC.
  • The members of the LLC shall not be responsible for any of the debts and liabilities of the firm. 
  • In California, however, not being registered does not preclude the non-registered LLC from defending a case in case a dispute arises due to breach of contract.

How Fast Can You Obtain EIN for Foreign LLC in California

An EIN for foreign LLC in California can be obtained by immediately if applying online and by mail or fax it may take up to 1 week.

If you are looking to set up a business in California, you will need to apply for an Employer Identification Number, also known as an EIN. An EIN is important for a number of reasons. First of all, it helps you file taxes with the IRS. In addition, it can be used to open a bank account for your company. Obtaining an EIN for your California company can be done in a few easy steps.

The first step to getting an EIN is to figure out which type of business you will be operating. Depending on the type of business, you may need to obtain a different tax ID. For example, a sole proprietorship will probably not require an EIN. But if your business is a limited liability company, you will need to apply for one. This can be done either online or by fax.

You will need to complete the appropriate form and pay a fee. Your EIN will be issued by the IRS. There is a standard four-week processing timeframe for EIN applications sent by mail. However, you can speed up the process by requesting a 24-hour expedited filing. It costs a small non-refundable fee.

The most obvious use for an EIN is to open a business bank account. A separate bank account helps you avoid commingling funds, which can make filing your taxes more difficult. Similarly, an EIN will help you keep track of your employees’ payroll taxes. Additionally, it is helpful for drawing partnership return files.

Another benefit of an EIN is its ability to protect you and your business from identity theft. This is particularly useful if you are a foreign national. As with any business, it is essential to protect your personal information and assets, such as your social security number, from being used fraudulently.

Getting an EIN for a business in California is a small, simple process that will make the business run more smoothly and efficiently. One of the most important aspects of this process is registering your business with the IRS. Once you have done that, you will receive an EIN which will be yours to use throughout your business.

There are a few more things you need to know before applying for an EIN for your California LLC. For example, you must pay the appropriate state and federal taxes, such as sales tax and excise tax. Although there are some tax breaks for businesses, you are required to pay your share. Also, you must be a legal resident of the state in order to qualify.

You will also need a Certificate of Good Standing. This is an official document which proves that your California LLC is legally registered in the state. Without this, you will have to pay penalties. While there is a small fee for obtaining a Certificate of Good Standing, it is worth it in the long run.

You may also wish to consider obtaining an Individual Taxpayer Identification Number (ITIN), which can be applied for through the IRS online. Although this option may not be the most convenient, it can be helpful in the overall process of obtaining an EIN for your California business.

FAQ

How to obtain EIN for foreign LLC in California?

To obtain EIN for your foreign LLC, you have to apply for it from IRS. Fill up the Form-SS4 and send it via phone, fax mail or submit it online.

Do I need to obtain EIN for foreign LLC always?

If you’re a self-employed individual then you do not have to obtain EIN, you can use your social security number to form an LLC.

Are EIN and TIN the same or different?

EIN and TIN (Tax Identification Number) are the same things. IRS issues both the identification numbers to the businesses. It is an eight-digit identification number issued by the IRS.

Do I need a Third Party Designee to obtain EIN for Foreign LLC?

It is not mandatory to have a third-party designee obtain EIN. A third-party designee is an individual appointed by the LLC. That person will be responsible for fill-up the form SS-4 by answering all the questions and also can receive the issued EIN if applied by phone.

In Conclusion

Obtaining EIN for any California foreign LLC is a must. This number is required to conduct business, open up a business bank account, report the Taxes to IRS, and so on. EIN is any business entity’s Social Security Number that is mandatory to transact business.

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