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I read this:

Every business that pays employees or is required to file any business tax returns is required to obtain an EIN.

Source: https://justworks.com/blog/itin-ssn-or-ein-whats-the-difference

Is this true? I am a sole proprietor and have filed business taxes on a Form 1040 with just a social security number. I did not obtain an EIN, nor did anyone say I had to, when I did business taxes.

I always just use SSN. Is it illegal to file business taxes as a sole proprietor with just an SSN?

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  • I read "business tax return" as "tax return in the name of the business". When the business is a sole proprietorship, the business itself doesn't have to file a tax return. Rather, you include the income and expenses of the business in your personal income tax return. So even in light of feetwet's answer, I don't think the statement is false, just perhaps not stated very clearly. Commented Feb 5, 2017 at 23:29
  • Businesses don't file tax returns, corporations do. A sole proprietorship is a business without a corporation. Yes, okay, this is a huge oversimplification, and there are exceptions, but that's the underlying principle. Form 1040 is a personal income tax return, where you report personal business income.
    – phoog
    Commented Feb 6, 2017 at 5:05

1 Answer 1

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As you have experienced, you are not "required" to obtain an EIN to file "any" business tax returns. You can go as far as a sole proprietorship filing on Schedule C just using your personal SSN.

You don't need an EIN until you either pay employees or want to file taxes as a separate business entity (e.g., an LLC).

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    Actually, even in the case of an LLC, it is a disregarded entity and you can file on Schedule C if you have just one owner of the LLC and don't affirmatively elect to be taxed as a corporation.
    – ohwilleke
    Commented Jan 6, 2017 at 23:20
  • @ohwilleke and if you make that election, the LLC needs an EIN, correct?
    – phoog
    Commented Feb 6, 2017 at 5:07
  • @phoog yes, because the corporation will then constitute a "real" (as opposed to "disregarded") entity and have to make filings as such. (And the only taxpayer identification number available to a filer that is not a natural person is an EIN.)
    – feetwet
    Commented Feb 6, 2017 at 12:49

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