How to Obtain an EIN in Minnesota | A Comprehensive Guide

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Obtain an EIN in Minnesota

In starting an LLC in Minnesota, it is crucial to understand the importance of an Employer Identification Number (EIN) and how it impacts your business operations. An EIN is a unique nine-digit number the Internal Revenue Service (IRS) assigns to businesses operating in the United States for identification purposes. This number is essential for running a business, such as filing taxes, opening bank accounts, and hiring employees.

This article will explore the complete guide to obtaining an EIN in Minnesota and the responsibilities and requirements associated with having an EIN.

Webinarcare Editorial Team will help you understand the process of obtaining an EIN. You must be guided by all the factors gathered in this article.

How to Obtain an EIN in Minnesota

EIN Definition and Purpose

To form an LLC, an EIN is necessary for your business. An Employer Identification Number (EIN) is a federal tax identification number used by the Internal Revenue Service (IRS) to identify businesses in the United States. It is similar to a Social Security Number (SSN) for individuals but is specifically designed for businesses. The main purpose of an EIN is to help the IRS track and administer taxes for companies.

In Minnesota, businesses are required to have an EIN if they meet any of the following criteria:

  • Have employees
  • Operate as a Partnership or Corporation in Minnesota
  • File tax returns for employment, excise, or Alcohol, Tobacco, and Firearms (ATF) taxes
  • Withhold taxes on income, other than wages, paid to a non-resident alien
  • Have a Keogh plan (a tax-deferred pension plan for self-employed individuals or unincorporated businesses)
  • Are involved with trusts, estates, real estate mortgage investment conduits, non-profit organizations, farmers’ cooperatives, or plan administrators

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How to Obtain an EIN in Minnesota

Obtaining an EIN in Minnesota is a straightforward process; several methods are available to apply for one. However, if you want to be at ease with the process you can hire an LLC Services in Minnesota, with add-ons of obtaining an EIN.

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Online Application Process

The easiest and fastest way to obtain an EIN is by applying online through the IRS website. The online application is available for businesses in Minnesota and the rest of the United States.

irs

To apply for an EIN online, follow these steps:

  1. Visit the IRS EIN Assistant webpage.
  2. Click “Apply Online Now” and follow the prompts to complete the application.
  3. Provide the necessary information, such as your legal name, trade name (if applicable), business address, and the responsible party’s Social Security Number or Individual Taxpayer Identification Number.
  4. Select the appropriate legal structure for your business (e.g., sole proprietorship, general partnership, corporation, etc.).
  5. Provide additional information as required, such as the number of employees, the reason for applying, and the primary business activity.
  6. Review and submit your application.

Upon successful completion of the application, you will receive your EIN immediately. Save or print a copy of the confirmation notice for your records.

Other Application Methods

If you prefer not to apply online or are unable to access the online application, you can also obtain an EIN through the following methods:

  • Fax: Complete Form SS-4 (Application for Employer Identification Number) and fax it to the appropriate fax number listed on the IRS website. You should receive your EIN within four business days.
  • Mail: Complete Form SS-4 and mail it to the appropriate address on the IRS website. The processing time for mailed applications is approximately four weeks.
  • Telephone: International applicants can apply for an EIN by calling the IRS at 267-941-1099 (not a toll-free number) from 6:00 a.m. to 11:00 p.m. Eastern Time, Monday through Friday.

After you have your EIN number, you can benefit in several ways. It will give your Minnesota LLC the final advantage necessary to operate fully without legal or judicial issues.

If you have a Registered Agent, he can file an EIN for your business. Also, if you are planning to file for an LLC in Minnesota, your Registered Agent should file for the Articles of Organization in Minnesota.

Uses of EIN in Minnesota

An EIN must run a business in Minnesota. Some of the primary uses for an EIN include:

Opening a Business Bank Account

Banks typically require an EIN to open a business bank account, which is essential for separating your personal and business finances. With a business bank account, you can accept payments, deposit funds, and manage your company’s finances more efficiently.

If you are planning a bank for your Minnesota business, you can check out the Best Banks in Minnesota, which offer the best combination of fees, services, and convenience for your business needs.

Filing State and Federal Taxes

Businesses in Minnesota must file taxes with both the state and federal governments, and an EIN is necessary to report and pay these taxes. Your EIN is used on various tax forms, such as income tax returns, employment tax returns, and excise tax returns which you can pay in Minnesota Department of Revenue.

Payroll and Employee Tax Reporting

If your business has employees, you will need an EIN to report wages and other compensation paid to your workers. Additionally, an EIN is required for withholding and remitting federal income and payroll taxes on your employees’ behalf.

If you hire an employee for your business, you must request that your employees complete the following forms:

  • Employment Eligibility Form
  • Federal Tax Withholding Form
  • W-4 Form
  • Workers Compensation Claim Form
  • Disability Self-Identification Form
  • U.S. Citizenship and Immigration Services Form

Applying for Business Licenses and Permits

An EIN is often required when applying for business licenses and permits in Minnesota. These licenses and permits may be necessary for various aspects of your business operations, such as zoning approval, health permits, or sales tax registration.

In Minnesota, business license fee costs around the range of $50 – $300. You can check out Minnesota Business Licenses to learn more about licenses and permits.

Establishing Credit and Securing Loans

An EIN can help your business establish credit, as it serves as an identifier for your company in the eyes of financial institutions. Additionally, lenders may require an EIN when applying for business loans or lines of credit.

Responsibilities and Requirements for EIN Holders in Minnesota

As an EIN holder in Minnesota, you are responsible for several tasks related to maintaining and managing your EIN. Some of these responsibilities and requirements include:

Updating the IRS on Changes to Business Information

If your business undergoes significant changes, such as a change in address, legal structure, or a responsible party, you must inform the IRS by filing the appropriate forms. This ensures the IRS has accurate and up-to-date information about your business and can properly administer taxes.

update my information

You can go to the Update My Information website of the Internal Revenue Service.

Required Tax Filings and Payments

With an EIN, your business is responsible for filing various tax returns and making tax payments to federal and state governments. Be informed about the specific tax obligations for your business type and industry in Minnesota.

To keep your business in good standing in Minnesota, you must file an Annual Report with the Minnesota Secretary of State. The annual report provides updated information about your LLC, such as changes in address, members, or Registered Agent.

Record-Keeping Requirements

Proper record-keeping is essential for businesses with an EIN, as it helps ensure accurate tax reporting and compliance with laws and regulations. Maintain records of your company’s income, expenses, and other financial transactions to facilitate accurate tax filing and minimize potential issues with the IRS.

Establish a reliable accounting system to track income, expenses, and tax obligations. You can manage your finances using spreadsheets, accounting software, or hiring a professional accountant.

Closing an EIN Account

Suppose your business ceases operations or no longer requires an EIN. In that case, you must notify the IRS by submitting a letter containing your complete legal name, EIN, business address, and the reason for closing the account. This allows the IRS to update its records and prevent future tax-related issues.

cancel EIN

If you have a copy of the EIN Assignment Notice that was issued when your EIN was assigned, include that when you write it to the IRS with the below mailing address:

  • Internal Revenue Service MS 6055 Kansas City, MO 64108
  • Internal Revenue Service MS 6273 Ogden, UT 84201

Or, you can check out Canceling an EIN via the IRS for further information.

Common Issues and Solutions for EIN in Minnesota

Business owners in Minnesota may encounter issues related to their EIN, such as losing or misplacing the number, incorrect information on the EIN application, or changes in business structure or ownership. Here are some solutions to common EIN-related problems:

  • Lost or Misplaced EIN: If you lose or misplace your EIN, you can contact the IRS by calling their Business & Specialty Tax Line at 1-800-829-4933. The IRS representative can provide you with your EIN after verifying your identity.
  • Incorrect Information on EIN Application: Suppose you discover an error on your EIN application, such as an incorrect business name or address. In that case, you can correct the information by submitting a letter to the IRS detailing the changes. Be sure to include your EIN, the incorrect information, and the correct information in your letter.
  • Change in Business Structure or Ownership: If your business undergoes a significant legal structure or ownership change, you may need to obtain a new EIN. Consult the IRS guidelines to determine if a new EIN is necessary.
  • Dealing with Identity Theft or Fraud: If you suspect your EIN has been compromised or used fraudulently, immediately report the issue to the IRS. The IRS can guide you through the steps to secure your EIN and protect your business from potential tax-related issues.

State-Specific EIN Information and Resources

To further assist businesses in Minnesota, here are some state-specific resources and information related to EINs and taxation:

  • State Tax Agency Information: The Minnesota state tax agency can provide information on state tax requirements, forms, and filing deadlines. Be sure to familiarize yourself with the state tax obligations for your business type and industry.
  • Business Registration Requirements: In addition to obtaining an EIN, businesses in Minnesota must also register with the appropriate state agencies. This may include registering your business name, obtaining necessary licenses and permits, and registering for state taxes.
  • Employer Tax Obligations and Filings: Employers in Minnesota must comply with various state tax obligations, such as withholding state income tax from employee wages and reporting these withholdings to Minnesota Department of Revenue. Research your business’s specific employer tax requirements in Minnesota.
  • Local Resources and Assistance for Businesses in Minnesota: Many local organizations and government agencies in Minnesota offer resources and assistance for small business owners. These resources may include business counseling, training, and financial assistance programs.

Do I Need to Apply for an EIN If I Also Have Business In Other States?

Yes, if you are operating a business with employees, have a corporation or partnership, or are required to file employment, excise, or alcohol, tobacco, and firearms tax returns, you will need an EIN (Employer Identification Number). If your business operates in multiple states, you only need one EIN for federal tax purposes. However, you may need to register for state-specific tax identification numbers in each state where you conduct business. Check with the Minnesota Department of Revenue to determine their requirements.

FAQs

What is an EIN?
An Employee Identification Number (EIN) is a unique nine-digit number assigned by the IRS to businesses for tax filing and reporting purposes.
How can I apply for an EIN in Minnesota?
You can apply for an EIN through the IRS website or by mail.
What information do I need to provide on my EIN application?
You’ll need to provide your business name, tax classification, address, and other identifying information.
When should I apply for an EIN for my Minnesota business?
You should apply for an EIN as soon as you start your Minnesota business.
Is there a fee to apply for an EIN in Minnesota?
No, there is no fee to apply for an EIN with the IRS.
How long does it take to get an EIN in Minnesota?
You can get an EIN immediately after applying online through the IRS website. If you apply by mail, it may take up to four weeks to receive your EIN.
Who is eligible to apply for an EIN in Minnesota?
Businesses, organizations, and nonprofits operating in Minnesota can apply for an EIN.
Do I need an EIN if I’m a sole proprietor in Minnesota?
Sole proprietors are not required to have an EIN, but may choose to get one for business purposes.
Can I use my Social Security number instead of an EIN for my Minnesota business?
Yes, but it’s best to obtain an EIN to protect your personal identity.
Can I have multiple EINs for one Minnesota business?
No, each business is limited to one EIN per entity.
What happens if I lose my EIN number in Minnesota?
You can contact the IRS to retrieve a lost EIN number for your Minnesota business.
Can I transfer my EIN to a new Minnesota business ownership?
No, EINs are assigned to specific taxpayers and cannot be transferred to a new owner.
Do Minnesota nonprofits need an EIN?
Yes, Minnesota nonprofits need an EIN to operate and receive tax-exempt status.
Can a parent company apply for EINs for its subsidiaries in Minnesota?
Yes, a parent company can apply for EINs for its subsidiaries in Minnesota.
What if my Minnesota business changes its name or ownership once an EIN has been assigned?
You can notify the IRS of any name or ownership changes to ensure proper tax filings with your existing EIN.
Do I need an EIN for a Minnesota LLC?
Yes, LLCs may apply for an EIN unless they’re taxed as a sole proprietorship.
Can I apply for an EIN for my Minnesota business over the phone?
No, you are unable to apply for an EIN with the IRS over the phone at this time.
How often do I need to renew my Minnesota business’s EIN?
EINs do not expire, so renewals are not necessary.
Can a foreign entity apply for an EIN for its Minnesota-based business?
Yes, a foreign entity can apply for an EIN to operate its business in Minnesota.
When should I provide my Minnesota business’s EIN to my bank?
You should provide your EIN to your bank when opening a business account or making tax payments.
How do I verify an EIN for a Minnesota business?
You can verify an EIN by using the IRS’s online search tool through their website.
Do I need to provide an EIN to my employee salaried withholding form in Minnesota?
Yes, you’ll need to provide your EIN to the Minnesota Department of Revenue to report employee taxes.
Can I obtain an EIN for a Minnesota-based trust?
Yes, a trust can apply for an EIN from the IRS.
Do Minnesota farmers need to obtain an EIN?
Yes, Minnesota farmers are required to have an EIN for tax reporting.
Can an EIN be canceled in Minnesota?
EINs can be cancelled or invalid if they’re not used within two years of issuance.
Is there a deadline to apply for an EIN for my Minnesota business?
There is no deadline to apply for an EIN, but it’s best to obtain one as soon as possible for tax liability purposes.
Is an EIN required for a Minnesota sole proprietorship with no employees?
No, an EIN is not required for a sole proprietorship if the business has no employees.
How do I correct mistakes on my Minnesota business’s EIN application?
You can file for a corrected EIN application by contacting the IRS.
What should I do with my Minnesota business’s EIN if I close down the business?
You should close out your Minnesota EIN by completing final tax filings and notifying the IRS of your business’s closing status.
What is an EIN and why do I need one in Minnesota?
An EIN (Employer Identification Number) is a unique nine-digit number used by the IRS to identify a business. You may need one in Minnesota to file taxes, apply for business licenses, and open a business bank account.
How do I obtain an EIN in Minnesota?
You can apply for an EIN online, by mail, fax or by phone with the IRS.
Is there a fee to obtain an EIN in Minnesota?
No, there is no fee to obtain an EIN.
Can I apply for an EIN in person in Minnesota?
No, you cannot apply for an EIN in person in Minnesota.
How long does it take to receive an EIN in Minnesota?
If you apply for an EIN online, you will receive it immediately. If you apply by mail or fax, it may take up to four weeks to receive your EIN.
Do I need an EIN for my sole proprietorship in Minnesota?
No, you do not need an EIN for a sole proprietorship in Minnesota unless you have employees or file certain taxes, such as excise or alcohol taxes.
Do I need an EIN for my LLC in Minnesota?
Yes, you need an EIN for your LLC in Minnesota, regardless of whether you have employees.
Can I use my personal social security number instead of an EIN for my business in Minnesota?
You can use your personal social security number for a sole proprietorship in Minnesota, but it is recommended that you obtain an EIN.
Is an EIN the same as a Minnesota tax ID number?
No, an EIN is a federal identification number, while a Minnesota tax ID number is a state identification number used for sales tax purposes.
Do I need an EIN for my non-profit organization in Minnesota?
Yes, even non-profit organizations in Minnesota need an EIN.
Can I cancel my EIN if I no longer need it in Minnesota?
Yes, you can cancel your EIN if you no longer need it in Minnesota, but only if you filed for it and did not use it.
Will I receive a physical copy of my EIN in Minnesota?
No, you will not receive a physical copy of your EIN. You will only receive it electronically.
Can I check the status of my EIN application in Minnesota?
Yes, you can check the status of your application by calling the IRS.
How long is my EIN valid in Minnesota?
Your EIN is valid for as long as your business exists, regardless of its location.
Can I use the same EIN for multiple businesses in Minnesota?
No, you must obtain a separate EIN for each individual business.
Can I change my EIN in Minnesota?
No, you cannot change your EIN in Minnesota. You must file for a new one.
What happens if I lose my EIN in Minnesota?
You should try to locate your EIN, but if you cannot find it, you can call or write the IRS to obtain a new one.
Do I need an EIN to receive a sales tax permit in Minnesota?
Yes, you need an EIN to receive a sales tax permit in Minnesota.
Can I apply for an EIN if I don’t have a social security number in Minnesota?
Yes, you can apply for an EIN if you do not have a social security number by filing Form SS-4 by mail or fax.
Can I authorize someone else to apply for my EIN for me in Minnesota?
Yes, you can authorize someone else to apply for your EIN for you by completing Form SS-4.
Can I change the name on my EIN in Minnesota?
Yes, you can change the name on your EIN in Minnesota, but you must inform the IRS by submitting a letter or filing an amendment.
What happens if my EIN application is rejected in Minnesota?
You should try to find the error and correct it, or call the IRS for further assistance.
Can I use an EIN from another state in Minnesota?
Yes, you can use an EIN from another state in Minnesota as long as the business entity is the same.
When should I apply for an EIN for my LLC in Minnesota?
You should apply for an EIN for your LLC in Minnesota as soon as you file Articles of Organization with the Secretary of State.
Can I have more than one EIN for my business in Minnesota?
No, you can only have one EIN for each individual business in Minnesota.
Do I need an EIN if I am a foreign entity doing business in Minnesota?
Yes, you need an EIN if you are a foreign entity doing business in Minnesota.
Can I use my EIN immediately after obtaining it in Minnesota?
Yes, you can use your EIN immediately after obtaining it in Minnesota.
Can I obtain an EIN if I am a trust in Minnesota?
Yes, trusts in Minnesota can obtain an EIN.
Can I apply for an EIN on behalf of my C corporation in Minnesota?
Yes, you can apply for an EIN on behalf of your C corporation in Minnesota as the responsible officer.

Also Read

How to Save Money While Getting Ein for Minnesota LLC

One of the first things to consider when forming an LLC is whether to hire a professional service or to do it yourself. While hiring a lawyer or a formation service can provide peace of mind and ensure everything is done correctly, it can also be very costly. DIY LLC formation is a great option for those looking to save money. There are numerous online resources and guides available that can walk you through the process step-by-step, saving you hundreds or even thousands of dollars in legal fees.

When it comes to filing fees, Minnesota has a relatively low cost for LLC formation. However, there are still ways to save money in this area. Filing fees can vary depending on the method of submission and the service provider used. By filing online directly with the Minnesota Secretary of State, you can save on fees typically charged by third-party filing services.

Another way to save money when forming an LLC in Minnesota is to carefully consider what services you need from the get-go. While it may be tempting to opt for additional services such as rush filing, certified copies, or virtual office services, these can significantly increase costs. By sticking to the basics and only paying for what you absolutely need, you can keep costs down and still meet all legal requirements.

It’s also important to keep in mind ongoing costs associated with your Minnesota LLC. Annual renewal fees are required to maintain your LLC in good standing with the state. It’s important to mark these deadlines on your calendar and budget accordingly. Additionally, consider whether or not you need to hire a registered agent for your LLC. While this service can provide convenience, it can also be an added expense that may not be necessary depending on your business needs.

Lastly, consider your business structure when forming an LLC in Minnesota. While an LLC offers liability protection and tax benefits, it may not be the best choice for every business. Depending on your business goals and financial situation, it may be worth exploring other business entities such as a sole proprietorship or partnership to save money on formation and ongoing costs.

In conclusion, there are numerous ways to save money while getting an LLC for your business in Minnesota. By doing your research, carefully considering your needs, and being mindful of costs throughout the process, you can establish your business without breaking the bank. With a little bit of planning and cost-conscious decision-making, you can successfully form an LLC in Minnesota and set your business up for success.

Conclusion

Understanding the importance and uses of an EIN in Minnesota is crucial for the successful operation of your business. By obtaining and maintaining your EIN, you can ensure compliance with federal and state tax laws, establish a strong financial foundation for your company, and access various resources and opportunities for growth. Be sure to utilize the available resources and support for businesses in Minnesota to maximize your chances of success.

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