To obtain EIN for South Dakota 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 South Dakota 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.
On this page, you’ll learn about the following:
- What is a Foreign Limited Liability Company?
- What is an EIN (Employer Identification Number)?
- EIN for a Foreign Entity or Foreign LLC
- Restriction In Business For Foreign Entities In South Dakota
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 South Dakota 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 South Dakota–
- 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.
Restriction In Business For Foreign Entities In South Dakota
Like any other state, South Dakota has a set of rules when it comes to starting a business as a foreign entity in the state. There are some basic guidelines that every foreign LLC has to follow in order to start transacting business in South Dakota. Here are the ones you must know,
Transacting Business In the State Of South Dakota
Under South Dakota law, to transact business in the state LLCs need to get registered with the South Dakota Secretary of State. Once the registration is done any foreign LLC can start doing business in South Dakota. For an LLC that is involved in sales, a business needs to collect state sales tax in their home state. Besides, they have to meet the requirements for existence in South Dakota. In order to do that an LLC has to satisfy the following requirements,
- LLCs should have a physical street address in South Dakota
- LLCs should have a store or/and a warehouse in South Dakota
- LLCs should have a sales representative in South Dakota
- LLCs should have a physical office in South Dakota
Once you fulfill the requirements, your foreign LLC will be able to collect the state sales tax in South Dakota.
Registering The Business
As I mentioned before, every LLC has to register themselves with the South Dakota Secretary of State in order to transact business in the state. To register your foreign LLC you need to submit the “Application for Certificate of Authority: Foreign Limited Liability Company” to the South Dakota SOS. To register your business you need to fill up the application form with the following information,
- Name of your LLC in the principal place of business
- Name of the home state
- Date of LLC formation in the home state
- Duration of the LLC in the home state
- Street address of the LLC office in the home state
- Name and address of the registered agent in South Dakota
- The mailing address of the LLC
- A statement that clarifies if the LLC is member-managed or manager-managed
- In case of manager-managed, the names of the managers
- An authorized signature
Once you submit the form, you will receive an email stating that the application has been accepted. The registration process will be started immediately.
Effect of Non-Registration
You can avoid the registration process and still transact business in South Dakota. Not registering your LLC does not affect your business, contracts, or debts. However, if you are not a registered LLC then you won’t be able to bring any lawsuit or case to the South Dakota State court. Not registering your foreign LLC in South Dakota does not restrict you to defend a lawsuit.
South Dakota Deceptive Trade Practice Act
Unlike other states, South Dakota does not have Uniform Deceptive Trade Practice Act. Any deceptive activities in the state fall under the South Dakota Codified Law. An Attorney General can bring a lawsuit if such activity takes place. A civil penalty of up to $2000 can be imposed on the accused if proven guilty.
In general, false advertisements, misinformation about a product or service, misleading promotions, and such are considered to be deceptive trade practices. Though, in South Dakota, not all such activities are punishable acts.
How Fast Can You Obtain EIN for Foreign LLC in South Dakota
An EIN for foreign LLC in South Dakota can be obtained by immediately if applying online and by mail or fax it may take up to 1 week.
An employer identification number (EIN) is required for any business in the United States, including foreign LLCs. An EIN is necessary for filing taxes, opening a business bank account, and other purposes. Obtaining an EIN is generally a simple process, though there may be additional steps for foreign LLCs. It is possible to obtain an EIN quickly for a foreign LLC in South Dakota, though the exact timeframe depends on the method chosen by the applicant.
The most straightforward way to obtain an EIN for a foreign LLC in South Dakota is to apply online. This method is fast and easy, and the application can usually be completed in minutes. The applicant will need to provide information about the LLC, including its name and address in South Dakota, and a valid email address. After submitting the application, the applicant should receive an EIN within a few minutes.
If the applicant does not have access to the internet or would prefer to apply by mail, they can use Form SS-4, Application for Employer Identification Number. This form can be downloaded from the IRS website or obtained from a South Dakota tax office. The applicant will need to fill out the form and mail it to the IRS. The timeframe for obtaining an EIN this way is approximately four weeks, as the form must be processed by the IRS.
It is also possible to obtain an EIN by phone. To do this, the applicant will need to call the IRS Business and Specialty Tax Line at 800-829-4933. The applicant will need to provide information about the LLC, including its name, address, and business activity. The IRS representative will then provide the applicant with an EIN. This process can take several minutes, depending on the complexity of the LLC and the amount of information the applicant provides.
Finally, applicants may be able to obtain an EIN for a foreign LLC in South Dakota from a third-party provider. These providers are not affiliated with the IRS, but can provide the same service as the IRS. The applicant will need to provide information about the LLC, and the provider will generate an EIN. The timeframe for this method varies, but can usually be completed within a few hours.
In conclusion, obtaining an EIN for a foreign LLC in South Dakota can be done quickly, depending on the method chosen. The fastest method is to apply online, which can typically be completed within minutes. If the applicant does not have access to the internet, they can apply by mail or phone, though this will take longer. Finally, applicants may be able to obtain an EIN from a third-party provider, though the timeframe for this method varies.
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.
Obtaining EIN for any South Dakota 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.