USA Self-Employed Needs to apply EIN

[chloe]

I have done a research regarding Independent Contractor at IRS.gov and found that if you are a business owner or a contractor who provides services to other businesses, then you are generally considered self-employed.

Moreover, I also have done a research at IRS.gov if Amanda needs to get a new EIN as a Self-employed Independent Contractor. And found that you only need an EIN if any of the following applies to you:

- You have employees
- Operate business as a corporation or a partnership
- You file any of these tax returns: Employment, Excise, or Alcohol, Tobacco and Firearms
- Withhold taxes on income, other than wages, paid to a non-resident alien?
- You have a Keogh plan?
- Involved with any of the following types of organizations?
- Trusts, except certain grantor-owned revocable trusts, IRAs, Exempt Organization Business Income Tax Returns
Estates
Real estate mortgage investment conduits
Non-profit organizations
Farmers' cooperatives
Plan administrators

The business that I work, all of the aforementioned requirements do not apply, but the owner ascertained that all of the self-employed she knew had to have an EIN.

So, I do really appreciate if someone could clarify this for me. Thank You.

 

[Marshall]

Not every self-employed person needs an EIN. Just because every self-employed person the owner knows has an EIN does not mean that one is required.

As you indicated, a business conducted as a sole proprietorship, which has no employees and does not file certain types of returns (such as excise tax returns) generally does not need to obtain an EIN (although there is no harm in doing so).

 

[AccountantSalary]

Just to tack onto Marshall's message, I've had a couple of sole proprietroships going now for ten years, none of which have EINs.