Benefits Of Using An External Filing Service To Obtain An EIN
One of the earliest administrative tasks for any business or organization is to apply for an Employer Identification Number (EIN). The EIN is a number issued by the Internal Revenue Service (IRS) to identify businesses in the U.S. for tax purposes.
Applying for an EIN is a procedure that involves several steps and requires relevant paperwork and documentation. You can obtain your EIN alone, but you don’t have to.
This article explains the 4 main benefits of using an external filing service to obtain the EIN. It will make the process faster and smoother, save you time, and increase your chances of getting the EIN approved.
Introduction – Importance Of An EIN For Businesses
You may be unsure of what an EIN is and whether you need it. According to IRS regulations, an EIN is required by businesses and organizations that are conducting business in the U.S. and file certain tax returns, such as excise taxes on goods or services.
Obtaining an EIN is not only beneficial but a necessary step for businesses. If you want to do the following, you will need an EIN:
● Open a business bank account
● Apply for a business loan and/or credit card
● Hire employees
● Apply for business permits or licenses
● File federal and/or state tax returns
An external filing service acts as a third-party designee, helping business owners apply for the EIN for a small fee. Let’s go over the advantages of hiring an external filing service provider.
Expertise – Familiarity With EIN Application Process
As we all know, paperwork can be extremely tedious. In the process of applying for an EIN number, you will have to fill out endless forms, furnish supporting documents, and send those to the IRS. Sometimes applicants who go at it alone will get their EIN application rejected due to special characters or symbols in their form, mismatched information, or unanticipated system errors. This is no fun.
On the flipside, if you leave this mundane task to a third-party designee that has successfully applied for EINs for thousands of businesses, you know you will be in good hands. Since they are experts who are very familiar with the EIN application process, they are up to date on the exact requirements, timelines, and documents needed, as well as do’s and don’ts. This means there will be no errors on your application, leading to faster and higher chances of EIN approvals.
Convenience – Time-Saving Benefits
As a business owner, it can seem like there’s an endless running list of things to do. And everything is a priority. But smart business owners will know that no man is an island. This may be a hard pill to swallow for independent entrepreneurs, but you cannot do everything yourself.
Outsourcing allows you to focus on your business growth instead of admin tasks like applying for a federal tax ID number. To apply for an EIN, the entire process can take up to a week, from gathering information and documents to filling out the form and submitting it to the IRS. By hiring an external filing service, you get to save time as they will take care of the process for you and manage any back-and-forth communications with the IRS.
Faster Processing – Compared With Direct IRS Application Processing Times
Hiring an external filing service provider to apply for your EIN puts you at the forefront compared to businesses that are navigating the process independently. They are bound to hit more speed bumps in the application process, which could result in an error, leading to a rejected application. Then, they’ll need to restart their application wondering what went wrong.
By going through an experienced third-party designee, you get an expedited external review of your Form SS-4 (Application for Employer Identification Number). With best practices applied, this will increase your chances of getting the EIN. If your online application is approved, you’ll receive your EIN number within an hour of submitting it.
Benefits For International Applicants – Navigating The IRS Application Process For Non-US Residents
Applying for an EIN is drastically more challenging for non-U.S. residents who want to register their businesses here. Foreign individuals who have a U.S.-based business or organization can only apply for their EIN by fax, phone, or mail, which have longer processing times of up to 4 weeks. There are also other factors to consider such as whether the applicant has a valid Taxpayer Identification Number or not.
An external filing service provider can be of tremendous assistance to non-U.S. residents and ease any anxieties around the EIN application. They can answer any questions, provide advice, help you fill out the form correctly, and make sure your application arrives at the IRS seamlessly. It takes the hassle out of navigating the complex IRS rules and regulations, especially as a non-U.S. resident.
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Considerations When Selecting A Service Provider
When selecting a third-party designee to apply for your EIN, here are 5 things you should consider:
● Legal compliance: The service provider should be registered and licensed so that you get peace of mind knowing your application is being handled by a trustworthy entity.
● Expertise and experience: Seek a service provider that’s experienced in filing EIN applications for businesses in your industry. Check if their website has a resource center for business owners. This usually demonstrates their expert knowledge on business tax and EIN matters.
● Cost: Consider the cost of the service provider’s fees and how they compare to other providers. Service providers with very low fees may not provide the level of guidance and expertise that you need, while higher fees usually indicate a better reputation and quality of service.
● Turnaround time: Check that the service provider’s turnaround time aligns with your timeline. The last thing you want is for the application process to negatively impact your business.
● Communication and availability: Ensure that the service provider is available to answer your questions and provide support throughout the application process.
Conclusion
With years of experience in handling EIN applications across various industries, we possess the knowledge and expertise required to navigate the EIN application process.
Let us help you get your EIN applications sorted out and approved. If you are still exploring your options, click here to learn more about applying for an EIN.