# Single-member LLC (disregarded entity) - do I need to get a Federal ID? (a FEIN#)



## Q. (Nov 30, 2007)

I am going to form a Missouri LLC for my new t-shirt business. I will be working by myself, so I will be a single-member LLC. I plan on organizing as a sole proprietorship (as opposed a corporation). I will not be hiring any employees until the business grows. 

My LLC will therefore be recognized by the IRS as a disregarded entity, and all revenues and expenses for my business will simply flow through to my individual tax return (Schedule C of the 1040, I believe).

After getting my LLC charter number, my understanding is that I do not have to get a Federal Employer Identification Number (FEIN#). Is this true? Can I get one if I want to? My current understanding is that, as a sole proprietorship LLC, I can simply use my Social Security number as my employer identification number. 

One concern I have is that when trying to sign up for wholesale accounts with distributors like Broder or American Apparel, they might reject my application without an FEIN.

Please share your thoughts, and thanks.


----------



## Annushka (Jul 26, 2006)

Yes you will need one if you're going to use some of the biggest wholesalers. American App, Article1 and others will not sell to you without it. (you can still purchase their stuff through a third-party retailer but it's costly, basically - you'll be paying retail prices for blanks)
I'm not familiar w/ LLC sturcture, but in ur situation i don't see the harm in getting one. it's free, it'll get you access to wholesale accounts. also, some wholesaler co-s won't do business w/ you on credit terms unless you have established a good credit as a business. and you can't do that without EIN either.
but my best advice is - ask an accountant, or if you have some time, go to ur local irs branch and speak to an officer. many folks don't like them, but they are actually very nice ppl


----------



## BoelenPython (Nov 22, 2007)

you can get an EIN online at irs very easy for a single member LLC.

You can also get one just for banking, or in ur name instead on biz name.

Many options.

But most wholesalers ask for an EIN

good luck


----------



## Q. (Nov 30, 2007)

BoelenPython said:


> But most wholesalers ask for an EIN
> 
> good luck


Thank you very much! That's what I thought....


----------



## Girlzndollz (Oct 3, 2007)

In PA, I didn't not need one. 

The director of our Small Biz Developement out of Wilkes Univ also advised me the that I did not need to file the paperwork to become an LLC. My choices were: sole proprietor, LLC, Inc. I wanted LLC for an added layer of protection between myself and any lawsuit. But being one person, he explained you carry the same liability as a sole proprietor as you do when you are a one person LLC. He said for the almost $2K, save the money. I was not buying any extra protect for myself. I saw his point the way he explained it, but wished I could have gotten that protection.

He also said I could or could choose not to get an EIN. I did get one, with my main goal being to shield my SSN from the world. You will need it when applying for everything, and I'd rather pass around an EIN. That was my main reason. 

If in the event I grow in the future and do take on an employee, I would need the EIN at that time anyway, so I just went for it right away.

If you have more questions like these, I would like to say why not find your local Small Business Developement Center run out of your local University or College?

They have all the info relating to these exact things and the info is as it applies in your state. 

The best part is this wealth of information IS FREE to you. They will work with you each step along the way, from set up and later, assist while you grow. My guy in PA has all the current accurate information, all I have to do is ask, and I get a personalized answer. I cannot say enough about this resource for small businesses. 

Best wishes.


----------



## badalou (Mar 19, 2006)

Annushka said:


> Yes you will need one if you're going to use some of the biggest wholesalers. American App, Article1 and others will not sell to you without it. (you can still purchase their stuff through a third-party retailer but it's costly, basically - you'll be paying retail prices for blanks)
> I'm not familiar w/ LLC structure, but in ur situation i don't see the harm in getting one. it's free, it'll get you access to wholesale accounts. also, some wholesaler co-s won't do business w/ you on credit terms unless you have established a good credit as a business. and you can't do that without EIN either.
> but my best advice is - ask an accountant, or if you have some time, go to ur local IRS branch and speak to an officer. many folks don't like them, but they are actually very nice ppl


Not true. All you need is a sellers permit or resale certificate depending which state you are in.. A fed. ID is only needed if you have employees. And then why would a supplier want to know if you have employees. They just want to make sure you are a business and and resell what you buy so they don't have tpo charge you sales tax and they are protected from an audit. I don't have fed Id and I buy from all the suppliers you mentioned and then some. Too many of you guys get caught up in the business process and really don't do your home work. 40 years in business and I never had a CPA.. I have had accountants and that is all I needed. Now I use turbo tax.. I talk to the box..


----------



## Annushka (Jul 26, 2006)

you may be right, i was just giving info that i'd collected from talking to wholesalers and other sources.
i didn't say Q should hire a full-time CPA, i advised to consult one. Q sounds like he/she is just starting out, and at that stage it is a good idea to consult a professional at least once, especially if you need some clarification re: certain things. and it doesn't have to cost u a thing, there is lots of qualified free help out there, just have to know where to find it
now once up and running, plus a few years under ones wing, some of us maybe talking to a box and some of us maybe keeping an entire separate accounting department. it all depends on the business structure


----------



## mothertongues (Aug 8, 2005)

Thanks for the reality check, Lou. I think a lot depends on your state too. I just filed for a LLC - $50 in Michigan. No need to get a FEID if you are a single person company - I've gotten wholesale accounts everywhere just with my social security #. 

I do like the idea of talking to professionals, but then make your own decisions. (re CPA, tax, etc)


----------



## BoelenPython (Nov 22, 2007)

and as far as having liability protection with a corporation or LLC,

A corporation or LLC usually doesnt offer liability protection like most think. It can if set up right and all paperwork is done, meetings etc.

The corporate veil is something that works for big companies but rarely small ones.

To make sure everything is set up right and you do everything you need to do to protect urself, get advice from a professional.

Also for business advice, Ive found that SCORE is awesome and free! They can help with all aspects of business advice.

As badalou said, it isnt 100% needed, but when you try to get registered with a wholesale company they will ask for ur EIN, if you dont have it, maybe badalou can give advice on what they will take instead? They need to prove that you are a business. When I got an account with american apparel a long time ago, they said all i needed was an EIN, but there may be other way around that.

Good Luck.


----------



## Buechee (Dec 22, 2005)

I would say if you are going to set up as a LLC, then get the Fed. ID number. Other wise just get a re-sellers permit. That's all I have, thanks to Lou. I have not had any trouble with getting anything wholesale since I got it. I'm not set-up as a LLC because I don't have anyone working for me. It's just me and my wife. I can't see any reason for someone to sue me in a court of law at this piont either. And as far as liability protection, get some insurance. I checking with some places here in OH. and they where $500 for the year or about $41.66 a month.


----------



## Q. (Nov 30, 2007)

Girlzndollz said:


> I did get one, with my main goal being to shield my SSN from the world. You will need it when applying for everything, and I'd rather pass around an EIN. That was my main reason.
> 
> If in the event I grow in the future and do take on an employee, I would need the EIN at that time anyway, so I just went for it right away.
> 
> If you have more questions like these, I would like to say why not find your local Small Business Developement Center run out of your local University or College?


Wow, three great points. Thanks!


----------



## Q. (Nov 30, 2007)

BoelenPython said:


> Also for business advice, Ive found that SCORE is awesome and free! They can help with all aspects of business advice.


Just this morning, I had someone at the coffee shop recommend SCORE to me.


----------



## BoelenPython (Nov 22, 2007)

good info..




Buechee said:


> I would say if you are going to set up as a LLC, then get the Fed. ID number. Other wise just get a re-sellers permit. That's all I have, thanks to Lou. I have not had any trouble with getting anything wholesale since I got it. I'm not set-up as a LLC because I don't have anyone working for me. It's just me and my wife. I can't see any reason for someone to sue me in a court of law at this piont either. And as far as liability protection, get some insurance. I checking with some places here in OH. and they where $500 for the year or about $41.66 a month.


----------

