Fact Checked by Editorial Staff
To obtain EIN for Ohio 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 an Ohio 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 Ohio 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:
- 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.
- 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.
- 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.
- 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.
- 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:
- 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.
- 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
- 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 - Ways to apply for EIN Ohio–
- 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 Ohio
If you are willing to start a foreign LLC in Ohio, you must know that there are some restrictions for you. These are general guidelines that all foreign LLCs should follow before forming a foreign LLC in Ohio. Here are some important points to note,
Transacting Business In Ohio
Transacting business in Ohio requires the registration of the company. Before starting up your Ohio foreign LLC you must register your business with the Ohio Secretary of State. After that, the taxes should be considered. To register for the state sales tax there are a few things a foreign LLC should have.
- A physical address in the state
- Warehouse in the state
- Any store/physical office in the state
- A sales representative in the state
If you are having all these things as a foreign entity, then you can transact your business in the state of Ohio.
Registering The Business
To register your foreign business in Ohio, one has to submit a Certificate of Authority. This certificate needs to have details like the name of the LLC when it was formed, the name of the LLC formed in Ohio, the name and address of the registered agent in Ohio, the address of the office for legal documents, a statement in which the LLCs will provide their consent for service of process, and so on. These details must be submitted through the Certificate of Authority.
Effect Of Non-Registration
Failing in registering the LLC brings some cons. The biggest disadvantage of not having a registered LLC in Ohio is that LLCs cannot file a lawsuit if needed. They can defend though. On the other hand, the members of the LLC won’t get personally affected or liable for not registering the company. LLCs, without registration, still can transact business in Ohio. However, it is recommended to get your foreign LLC registered in Ohio for a smooth and hassle-free service.
Ohio Deceptive Trade Practices Law
Any foreign LLCs transacting business in the state of Ohio have to be compliant with the Deceptive Trade Practice Act. Some of the businesses such as misselling, selling through misinformation, misleading sales, and any kinds of business that involve fraudulent activities are strictly prohibited. Attorney generals can bring the lawsuit. The civil penalty can be up to $25,000 if provided guilty.
FAQ
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.
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.
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.
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.
How Fast Can You Obtain Ein for Foreign LLC in Ohio
One common misconception among foreign LLCs is that obtaining an EIN for business activities in Ohio is a complicated and time-consuming process. However, the reality is that the process can be relatively quick and straightforward if foreign LLCs are well-informed and prepared. One of the most efficient ways to apply for an EIN is through the online application available on the Internal Revenue Service (IRS) website. By providing necessary information about the foreign LLC, such as its legal name, identification type, and country of formation, the online application can expedite the EIN issuance process.
It’s important for foreign LLCs to have all the required information ready before starting the application process. This includes knowing the legal name and address of the foreign LLC, as well as the responsible party’s Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN). Having this information readily available can help speed up the application process and ensure that the foreign LLC receives its EIN in a timely manner.
In some cases, foreign LLCs may be required to submit additional documentation to obtain an EIN, such as a Certificate of Good Standing from the state where the business is formed. It’s crucial for foreign LLCs to research and understand these requirements beforehand to avoid any delays in the EIN issuance process. By being proactive and prepared, foreign LLCs can minimize any potential obstacles and obtain their EIN in a prompt fashion.
Another important consideration for foreign LLCs looking to obtain an EIN in Ohio is the need for a designated responsible party. The responsible party is typically an individual who has the authority to act on behalf of the foreign LLC, such as a manager or member. Foreign LLCs must provide the responsible party’s SSN or ITIN when applying for an EIN. By designating a responsible party and having their information ready, foreign LLCs can streamline the EIN application process and ensure a smooth and efficient issuance of their EIN.
In conclusion, obtaining an EIN for a foreign LLC in Ohio doesn’t have to be a complicated or lengthy process. By being well-informed, prepared, and proactive, foreign LLCs can successfully and quickly obtain their EIN and begin conducting business activities in the state. Utilizing online resources, having all necessary information ready, and understanding potential requirements are all key steps in expediting the EIN application process for foreign LLCs. With the right approach and mindset, foreign LLCs can efficiently navigate the process of obtaining an EIN in Ohio and focus on growing their business in the state.
In Conclusion
Obtaining EIN for any Ohio 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.