Do You Need a Separate Business Account If You’re Self-Employed?

employer identification numberWhen you’re self-employed, you become subject to a number of requirements that are required for all businesses in the country. These requirements can apply to certain business designations and can become confusing. 

If you’re wondering, “do I need an EIN for self-employed,” we can help you determine it. At the Law Office of Max Benkel, a tax attorney in Atlanta, we provide advice and legal representation for all aspects of business taxation.

What is an EIN?

The Employer Identification Number, or EIN, is a numerical designation used to identify a business. It is a 9-digit number issued by the government that is similar to the Social Security number given to individuals. 

Anyone who hires other people for their business operations requires an EIN for payroll reporting. In addition, an EIN is used for many other official activities normally used in business.

Do I need an EIN if I am self-employed?

Those who are self-employed under the sole proprietor business designation are not legally required to acquire an EIN. However, the number may be necessary to conduct certain types of business activities, such as opening up a business bank account, paying employees, applying for a loan, acquiring licenses, and other actions. You will also need an EIN if you decide to change your legal business designation, such as forming a corporation or partnership and contributing to an employee retirement fund.

Meeting your tax and legal obligation is critical to running your business. Your tax attorney can help you stay apprised of current requirements and any changes in laws that might affect your financial planning. Contact the Law Office of Max Benkel to know more about legal requirements and how to meet them. 

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