Aspiring foreign residents of treaty countries always wish to form a business in the United States. Indeed, the United States is one of those states which has most of the benefits for business owners. But it is not very simple to form an organization in the United States. Not always, but in many cases they need to strive hard to get a visa. Do you know which kind of visa they will require? The visa makes them eligible either for employment, or developing and directing a business in the United States.
Not in all cases they need a visa to start a business in the USA, but even if they obtain the E2 visa, the striving still continues. They have to get Tax ID numbers too. Tax ID numbers include Social Security Number (SSNs), Individual Taxpayer Identity Number (ITINs), and Employer Identity Number (EINs). These are number issued by the United States to the foreign residents for tax purposes. These are issued depending upon their status. Often business owners find it easier to form a Limited Liability Company in the United States, and for that they require a suitable Tax ID number.
There are several foreign individuals who do not have Tax ID numbers i.e. SSN numbers, ITIN numbers and EIN numbers but they wish to form a Limited Liability Company. For this reason, we have found people asking, how to open an LLC without ITIN number? This question is becoming very common for those who neither have an ITIN number, SSN number or an EIN number.
This blog covers all the necessary information you need to know about how to open an LLC without ITIN number.
What is a Limited Liability Company?
A Limited Liability Company is one of the types of organizations that combine a pass through taxation of a sole proprietorship business or a partnership business with the limited liability of a corporation. This kind of organization has business profits and losses on the basis of personal income of tax returns of owners. It is unlike a taxation business entity.
The people who are trying to find out how to open an LLC without ITIN number must keep in mind that the owners are protected from personal liability for business claims and debts, which is why it is termed as ‘Limited’. With Limited Liability Company, when a business owes money or faces any lawsuits, only the assets of the business will be at stake, the creditors cannot put their hands on the personal assets of the LLC owners such as their house or their personal vehicle because their liability is limited.
Due to this reason, most of the people prefer forming a Limited Liability Company in their home country as well as the United States and often ask how to open an LLC without ITIN number. This is one of the best features of a corporate business structure. But prior to forming an LLC in the United States, foreign investors think that they need to have an ITIN number to start their business entity that is why the ones who do not have an ITIN number are concerned about how to open an LLC without ITIN number.
But it is not true, foreign investors require an EIN number to develop and direct their business in the United States. Also, some people think that in order to obtain an EIN number, one requires either an SSN number or an ITIN number, which is again not true as EIN number can be obtained if one has neither of them. Consequently, if you are concerned about how to open an LLC without ITIN number, you need not worry as you can open an LLC without an ITIN number as well. For more information on how to open an LLC without an ITIN number, please send us an email at firstname.lastname@example.org.
What is a Tax ID Number (TIN)?
According to the Internal Revenue Service (IRS), a Taxpayer Identification Number (TIN) is an identification number that is used by them for serving the tax purposes and tax laws. It is a nine digit number that is issued to the foreign investors as a tracking number. This number is required for all the tax returns filed with the Internal Revenue Service.
A Tax ID Number comes in three different forms. Individual investors are provided TINs in the form of Social Security Numbers (SSNs) and Individual Taxpayer Identification Number (ITINs) while the corporations and business are given Employer Identification Numbers (EINs). Depending on the category, these numbers are issued by the Social Security Administration (SSA) or by the Internal Revenue Service (IRS) itself.
The people asking how to open an LLC without ITIN number should know the details about the different types of numbers. Let’s have a look on the details below.
What is an Individual Taxpayer Identification Number (ITIN)?
The ones who want to have a clear understanding about how to open an LLC without ITIN number, they need to understand what an ITIN number is. Individuals Taxpayer Identification Numbers (ITINs) are issued to several individuals who belong to the treaty countries but are not eligible to get the SSN numbers. This is because these individuals are not employed hence they are issued ITINs by the IRS to file taxes. Consequently, individuals asking how to open an LLC without ITIN number should keep this in mind that it is only required to file taxes and not open an LLC.
ITIN numbers are nine digit numbers which start from 9 followed up till the range of 70 to 88 till its fourth and fifth digit. After the amendment in the year 2011, the range of the ITIN number has extended. As previously mentioned, they are issued by the IRS to the foreign investors. The people who want to obtain ITIN numbers, they must fill form W – 7 and form it to file their returns on taxes.
What is a Social Security Number (SSN)?
Before we go into the details of how to open an LLC without ITIN number, you must first know what an SSN number is. A Social Security Number (SSN) is a number which comprises of nine digits and is required for filing taxes. It is issued by the Internal Revenue Service (IRS) to the individuals who are permanent residents or citizens or temporary alien residents of the United States. These individuals may either be working or employed in the United States, hence are granted an SSN number.
The permission of issuing SSN number to such individuals is granted by the United States of Citizenship and Immigration Services. Those who need an SSN number, they are required to fill form SS – 5, once they obtain it, they can use it t file for their tax returns. As a result, individuals asking how to open an LLC without ITIN number; must remember that they neither require an ITIN nor an SSN number to open a Limited Liability Company in the United States.
What is an Employer Identification Number (EIN)?
In order to learn the core of the query, how to open an LLC without ITIN number, you must know what an EIN number is. An Employer Identification Number (EIN) is a nine digit number that is issued to the corporations and companies by the Internal Revenue Service (IRS). These numbers are also referred to as Federal Tax Identification Number. They are provided to the organizations in order to identify tax payers who require filing tax returns.
People often think that only corporations are given EIN numbers and ask how to open an LLC without ITIN number. Well, it is not true as sole proprietorship business, non-profit organizations, partnership business, trusts, estates of decedents, government agencies and certain individuals are also given EIN numbers.
Additionally, EIN numbers are really necessary for the organizations to open a Limited Liability Company, so people concerned about how to open an LLC without ITIN number should not forget this. In order to obtain an EIN number, they say you need to have an ITIN and SSN both or either of them, but they may not know that it is also possible to get an EIN number without them.
Factors That Makes One Eligible for an EIN Number
Now that you know you require an EIN number to open a Limited Liability Company so you need not worry about how to open an LLC without ITIN number. However, there are certain factors and requirements that make one eligible for an EIN number, which you must consider. Also, a Limited Liability Company must fulfill the following requirements.
- You are required to get an EIN number when you are paying $600 or more to your employees.
- You need to have an EIN number when you are operating a corporation, sole proprietorship business or a partnership business.
- You must not forget to get an EIN number when you hold taxes on income or other wages to a non resident alien.
- You need to get an EIN number when you file taxes for tobacco, alcohol, excise, employment and firearms.
- You must obtain an EIN number when you have a Keogh plan.
- You should get an EIN number when you are involved in the following types of organizations.
- Non- profit organization
- Farmers cooperatives
- Real estate mortgage investment conduits
- Trusts but not the ones which are owned by the grantor and IRAs
- Plan administrators
How to Open an LLC Without ITIN Number? But First See Do We Really Need an ITIN Number?
There is a common belief that in order to open or establish a Limited Liability Company in the United States, foreign investors need to obtain an EIN which is why they must have an ITIN and ask how to open an LLC without ITIN number. This is not true. You do not need to have an ITIN number to obtain an EIN number at the first place. You can get your EIN number without an ITIN number also. In order to understand the depth of this, keep reading, or email us at email@example.com.
When a company starts doing a business in the United States, it requires an Employer Identification number (EIN), though it can be very intimidating for a foreign investor to obtain an EIN number without an ITIN and SSN number but you must never discourage yourself, as it is not impossible at all. The process may seem complicate, complex and is also very time consuming but it is worth the wait. It is just a matter of few months.
How to Open an LLC Without ITIN Number?
Many people residing in the United States have their own businesses and many foreigners come from their home countries to start a business in the United States, but it is not necessary for both of them to obtain an ITIN number or an SSN number for EIN number. So they must not worry about how to open an LLC without ITIN number. The people who think it is mandatory to have both of these numbers, ITINs and SSNs are mistaken.
However, there are some important and four elements that one must not forget for EIN numbers.
- The residency status of an individual (resident or non resident).
- The type of organization structure (C Corporation, S Corporation or a Limited Liability Company).
- The association with attorneys, or accountant for businesses.
- The co founders of the United States business.
On the basis of the specified elements, you can determine easily if you require an ITIN or an SSN number for obtaining an EIN number. But as mentioned previously, it is not mandatory to have either of them to get an EIN number. If you are trying to identity how to open an LLC without ITIN number, read this section carefully.
Obtaining an EIN number is not very complicated but it is a very time consuming process especially when one does not have an ITIN or an SSN number. To make the process smoother and easier, the foreign individuals need to understand the basic overview for the EIN application process. The following are the steps that foreign investor must follow to get an EIN number without an SSN or an ITIN number.
· Step # 1: Credible Business Accountant
The foreign investors and companies need to have a credible and loyal business accountant who can represent as the third party designee for your business.
· Step # 2: Preparation of Application
The next step is to prepare the application for your EIN number. Your accountant will be required to assemble all the documents and prepare an application for the Employer Identification Number (EIN).
· Step # 3: Contact IRS
Once the accountant, prepares the application for the EIN number, they will be required to contact the Internal Revenue Service (IRS) Center for the foreign investors. After that, they will have to fax the signed form to the IRS office.
· Step # 4: Getting EIN Number in Hands
If the application you submitted is considered genuine by the IRS, the authority will accept it and the business accountant you hire will be required to collect the EIN number on your behalf on the same day.
Now that you know the entire procedure of how to open an LLC without ITIN number, you must have noticed that the business accountant in the process is playing a vital role throughout the procedure. So, one of the most important elements that you need to focus on, is the hiring of credible and professional business accountant.
Without the accountant, the application process for the EIN number will never go smooth and since they are the ones who have an SSN or an ITIN number, the IRS grants you EIN number because of them. Their SSN or ITIN number serves as the base to obtaining EIN numbers. Make sure that you choose your business accountant wisely.
You can call us, or email us at firstname.lastname@example.org to get your EIN number without an ITIN number, nor Social Security Number.
All What Matters for an LLC is an EIN Number and Not ITIN Number – Ways to Obtain EIN Number
Now that you know that in order to open an LLC an EIN number is required and not an ITIN number you must have now got an answer to the question ‘how to open an LLC without ITIN number’. Since EIN number is considered so important, one having both the tax ID numbers and ones who do not have it must know about the ways to obtain the EIN numbers also. There are several ways to get an EIN number. Let’s have a look at them below.
· You Can Apply for an EIN Number Online
IF you already have a social security number, or an ITIN number, one of the best ways to apply for the EIN number is to apply online. With the help of your accountant, you can send an internet application for the EIN number to your customers who want to get an EIN number. Once the online application procedure is completed, the information is legalized on the web and the EIN number is granted to the issuer. The individuals must keep in mind that this online application process is openly available to all types of entities located in the United States.
· You Can Apply for an EIN Number Via Mail
Another option available to all foreign individuals is that they can get their EIN number via mail. Also, the processing time frame is not too much; it is just four weeks instead. When you are trying to obtain EIN number via mail, you need to fill form SS – 4 and fill all your genuine information and complete the form to avoid rejections. According to your entity type, EIN number is issued.
· You Can Apply for EIN Number Using Fax
Apart from obtaining EIN number via mail and online, another way to get it is using tax system. Though it may seem traditional to some foreign investors but is the easiest of all. If you are trying to know how to open an LLC without ITIN number, you need to completely fill the form SS – 4 and send it to the fax number. But before sending the form you must see that all the information you have provide this genuine and correct. Once the IRS finds that the information provided is all correct and up to the mark, they issue an EIN number to the foreign investor within 4 business days.
· You Can Apply for EIN Number Using Telephone
You need not worry how to open an LLC without ITIN number because you can apply for an EIN number using telephone as well. The international or foreign applicants can call at 267 – 941 – 1099 anytime from Monday through Friday during 6:00 a.m. to 11:00 p.m. to inquire or obtain their EIN number.
As you are applying via telephone, you will be talking directly to the IRS representative, so you must make sure that there is no distortion in the line and disturbance that become one of the causes of conveying the incorrect information. The IRS representative will be filling the form SS – 4 for you. So you must know all the information related to it.
Perks of Forming a Limited Liability Company (LLC)
The people who are trying to know how to open an LLC without ITIN number may also be interested in knowing the benefits of forming a Limited Liability Company in the United States. Let’s have a look at those benefits.
- Limited Liability Companies have the protection element for the owners. The limited liability gives them the benefit to control and hold their personal assets, if a lawsuit is filed against them.
- Such companies typically do not pay taxes at the business level. The income or loss of the business has a pass through taxation for the owners and the taxes are reported on their personal income.
- Forming an LLC in the United States will help a new business establish credibility with most of their customers, vendors, employees and business partners.
- These companies do not face more state requirements, they have lesser compliance requirements.
- There are few restrictions for the owners of the Limited Liability Companies.
- Such companies are free to establish any organizational structure as they have flexible management structure. It can be managed by managers unlike corporations.
Now that you know how to open an LLC without ITIN number, you can make an informed decision. Good Luck! You can email us at email@example.com for help with this process.