If I Have Two Businesses, Do I Need Two Separate EIN Numbers?

One of the unpleasant sides of doing business is figuring out taxes, from sales tax to income tax. Perhaps you have mastered the taxes for your small business, which is very successful, and want to begin a new venture. You may wonder how having two entities will affect your tax requirements. If you already have an employer identification number, will you have file for an EIN again? The answer depends on the structures of your companies and your preference in asset protection. Different entities require different EINs, and if companies share an EIN, then if one company is sued, both companies could be liable. This is why many business owners obtain a unique EIN for each business.

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The Role of Business Structure

If your two businesses have the same structure, then you can use the same tax ID. This can make things simpler, as you will have fewer forms to fill out and fees to pay, as well as the ability to file the taxes together.

However, if the businesses are structured differently, then you will have to get an EIN for the new one, because the tax regulations for each type are not the same. For example, someone who already operates a corporation and wants to start an LLC will need to acquire a separate tax ID for the LLC.

Securing Your Assets

Even if both companies belong to the same tax category, you may still wish to file for a second EIN to protect your assets. When both your businesses are under one number, the assets of both of them are at risk when it comes to liability. Having each under its own federal EIN will ensure the protection of one entity from the losses of the other. It may be wise to consult with an attorney as to which approach would be best for your circumstances.

How To File for an EIN

While starting an additional business can be overwhelming, obtaining another tax ID does not have to be. Apply for an EIN online with us to make the process quick and easy, so you can spend more time on the other aspects of setting up a company.