An EIN Number Lasts Forever…and Ever…and Ever
When closing a small business, there are many things to consider. On a federal level, a business typically must file an annual return for the year it goes out of business. Depending on the business structure or whether the business had employees, there are a number of tax forms that typically must be filed with the IRS before a business is deemed closed by the federal government, not to mention state tax requirements.
Does an EIN get canceled when a business closes?
Once the fiscal responsibilities have been met and the entity has been formally dissolved, one step that is frequently overlooked is closing the EIN business account with the IRS.
Many business owners think that once all final tax filings have been made, the IRS will automatically discontinue or close an EIN, but just as the title of this article implies, a business’s EIN is never discontinued, reassigned or reused. Regardless of whether or not an EIN was ever used, the number is PERMANENT. The IRS cannot cancel EIN numbers; however, the business account associated with the EIN may be closed. If the EIN is needed in the future, it will still belong to the business entity even after the account is closed.
To close a business account with the IRS, a written letter must be sent to: Internal Revenue Service, Cincinnati, OH 45999.
The letter must state the reason for closing the account and include the federal identification number, the complete legal name of the entity, and the business address. If a copy of the EIN Assignment Notice is available, be sure to include it with your letter. For entities that are deemed liable for business taxes or have been notified that business tax returns are due, the appropriate tax returns will need to be filed before the EIN account can be closed.
Harvard Business Services strongly suggests that you seek the assistance of a qualified tax professional when closing a business. Please reach out to us if you need help closing your company.
I'm not closing, just re-organizing. Do I need a new EIN?
Ultimately, the decision on whether you need a new EIN will be made by the IRS, but as a general rule, any time a business re-organizes it will need to change EINs. Examples of re-organization include:
- Changing from a corporation to another entity, like an LLC or Limited Partnership, or vice versa
- Incorporating in a new state, resulting in a new state charter
- Merging corporations, resulting in a new corporation
- Changing a sole proprietor to a partnership or other business entity like a corporation, LLC, etc.
- Changing a partnership to a sole proprietor or other business entity like a corporation, LLC, etc.
- Changes to a partnership, resulting in a new partnership (i.e. one partner out, a new partner in)
- Changes in business ownership that result in the original EIN applicant no longer maintaining ownership of the company
Aside from re-organizing a business, most other changes typically do not require a new EIN. Here are some examples that do not require you to change EINs:
- Changing the name of your business
- Changing a location or adding a location
- Electing to be taxed as an S corporation or electing, on Form 8832 Entity Classification Election, to change the way the entity is taxed
- A partnership or corporation declares bankruptcy
These lists are not meant to cover all situations, but do cover a number of common changes we see everyday. If you still wonder whether or not you need to change EINs, check out this article on IRS.gov, Do You Need a New EIN?, or feel free to contact us for more information.
*Disclaimer*: Harvard Business Services, Inc. is neither a law firm nor an accounting firm and, even in cases where the author is an attorney, or a tax professional, nothing in this article constitutes legal or tax advice. This article provides general commentary on, and analysis of, the subject addressed. We strongly advise that you consult an attorney or tax professional to receive legal or tax guidance tailored to your specific circumstances. Any action taken or not taken based on this article is at your own risk. If an article cites or provides a link to third-party sources or websites, Harvard Business Services, Inc. is not responsible for and makes no representations regarding such source’s content or accuracy. Opinions expressed in this article do not necessarily reflect those of Harvard Business Services, Inc.
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There are 8 comments left for An EIN Number Lasts Forever…and Ever…and Ever
Chris said: Tuesday, October 24, 2023I am a non-US citizen. In 2015 I incorporated a Corporation in Delaware. I never did anything with it, nor opened a bank account. I've seed now it's voided and has a incredibly large "Annual tax assesment" and Tax Due. Now I want to build a new LLC in Delaware. Will this old corporation block me from doing any new business in the US?
HBS Staff replied: Tuesday, October 24, 2023Hi Chris,
Thank you for your question and for reading our blog. We are happy to help you start a new LLC. You can have as many companies as you would like in Delaware. One of our sales representatives will reach out to you.
Rashmi Sataydeo said: Tuesday, August 25, 2020There was a corporation in New York, the tax returns were filed till 2008 and tthere was no atax returns were filed since there was no activity, now I want to start a business in Texas and I incorporated in Texas should I file for new EIN number..I am using the same business name...
HBS Staff replied: Tuesday, August 25, 2020There are a number of factors here that you may wish to discuss with an attorney or accountant to get a complete understanding of your options. Typically, when our clients start a new company in a new state, as long as the company name is available with the state, they also get a new EIN.
hesham mohamed said: Thursday, July 25, 2019Dear All I'm going to open an account at amazon E.commerce, an individual seller I'm nonresident & not USA citizen I'm from Egypt, so my inquiry is, can I get EIN & ITIN without establishing LLC company? thanks for cooperation
HBS Staff replied: Monday, July 29, 2019Hesham, an EIN is generally used for a business entity, such as an LLC or corporation. We have a resource specifically for setting up an Amazon business. Perhaps this will help you: https://www.delawareinc.com/blog/using-delaware-company-amazon-seller-business/
Liz said: Saturday, June 8, 2019I purchased an EIN number and LLC from you for my business back in 2007. After a while, I stopped renewing the LLC. I still continued to use the EIN number for tax purposes since my business remained opened. Am I able to put the LLC back on my business years later and still keep my EIN number?
HBS Staff replied: Wednesday, June 12, 2019Liz, please contact our filings department via email at filings@delawareinc.com or by phone and provide us with the name of the company and/or state of DE file number so we can research the revival options. As for the EIN, the number stays active until the client cancel it directly with the IRS.
Essam Ibrahim?? said: Sunday, November 25, 2018Hi, Can you help me after getting the EIN by your Company open a Bank business account while I am not resident in the US. Thank you in advance. P.S. Also, can I use these informations to open a personal nonresident account in US bank.
HBS Staff replied: Monday, November 26, 2018Essam - Unfortunately, we do not provide assistance with opening a U.S. bank account. One of the most common and inflexible requirements for opening a business bank account in the United States is showing up in person to do so. Once you've decided on a bank, it's generally a good idea to call ahead to see what is required to open the account, since requirements differ from bank to bank.
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