Ein

[NotEasy]

Taxpayer had a business which had been closed long time ago. Lately, he started a new business. When he called the IRS for an EIN, he was told to use the same EIN of his old business, even though the business name and address of his new and old business are different. Does it make sense?

[JohnH]

If it's a sole proprietorship it makes sense. But not if it's a corp.

[NotEasy]

If it's a sole proprietorship it makes sense. But not if it's a corp.

Thank you for the reply.

Yes, it is a sole proprietorship. So I guess the taxpayer has understood what the IRS representative said correctly.

What still puzzled me is that the taxpayer said the representative did not even ask him for the name and address of his new business. So do they update the information when they receive the first payroll tax return of the taxpayer's new business?

[S T]

Change of Address

You could always complete and send in the Change of Address form 8822 to update t/p's account information.

Sandy

[NotEasy]

You could always complete and send in the Change of Address form 8822 to update t/p's account information.

Sandy

I understand the taxpayer can always do that. What I do not understand is why the representative didn't ask for the name and address of the new business when the taxpayer called in. Is it a policy to wait for the payroll tax return to update the information? I am just being curious here.

[Burke]

If you are asking why they did not update the records with new info provided by the caller, I doubt if they would do it without a written request or signed 8822. I would still prefer a new EIN. He can get it online with no problem. Keeps things neater. Especially if there is payroll involved.

[JohnH]

Cana sole proprietorget a new EIN? I thought that answering the question about "Have you ever had an EIN in the past?" would automatically set in motion the process to reassign the same EIN to a sole proprietor.

[Burke]

Don't know. Never had that situation, just assumed they wanted to know that info to determine what was going on with the requestor. All the EIN's I have done in recent years have been for LLC's, SCorps and Estates/Trusts. But a sole proprietor would not need one unless it had payroll taxes to report. I am uncomfortable with mixing new businesses with old businesses.

[outwest]

What you have to remember..

is the the EIN of the sole prop is tied to the person. So, unless the individual somehow morphs into an alien life form, they will always use the same EIN for all their sole props. BTW, this is also why the name on the 941 is the sole prop's name.

Now, if they form a SMLLC, under current regs they will get another EIN for the SMLLC with which to report payroll. And so on for a second, third or hundredth SMLLC

If they've never received a EIN tied to the person, a second EIN will be issued for the individual, once and only once.

Year's later, the EIN I had as a farmer is still in use with my practice as a CPA.

[Black Bart]

It's like lots of things at IRS

Cana sole proprietorget a new EIN? I thought that answering the question about "Have you ever had an EIN in the past?" would automatically set in motion the process to reassign the same EIN to a sole proprietor.

which is to say, it's the luck of the draw -- depends if the clerk you get feels like checking it out. I've done it both ways and years ago had two sole prop numbers myself (marked "No" because I was unsure what should be done and didn't want to mix old/new biz). On the other hand, one client who didn't know his old number, checked "No," then received IRS letter advising EIN was issued previously, that it was number so-and-so, and to use that from then on. Never had any problems out of either case.

P.S. I still don't quite get it about having only one number if you have two or more business locations. Looks to me like payroll taxes and reports would be all mixed up/a mess.