To obtain EIN for North Carolina foreign LLC one has to follow a few steps. Limited Liability Companies are easier to form than other structures of business. However, it is a bit tricky for the LLCs to form a foreign LLC in any of the states. There can be some restrictions for the Foreign LLCs to form an LLC in North Carolina. Take a look at this article to know about how to obtain EIN for your foreign LLC. It will answer all your questions related to EIN, including the procedure for a foreign entity to obtain EIN, the filing cost, etc.
On this page, you’ll learn about the following:
- What is a Foreign Limited Liability Company?
- What is an EIN (Employer Identification Number)?
- EIN for a Foreign Entity or Foreign LLC
- Restriction In Business For Foreign Entities In North Carolina
What is a Foreign Limited Liability Company?
An LLC is always formed in accordance with the state rules. The state where the LLC is formed is often referred to as the main state for the LLC. It is where the LLC has its main operational center. When the LLC business members are trying to expand the LLC & wish to form it in some other states as well, the LLC is a foreign entity in the new state. The LLC is formed in the new state will be referred to as “Foreign Entity” or “Foreign Corporation” or “Foreign LLC.” Forming the North Carolina Foreign LLC is easier & involves obtaining an EIN.
What is an EIN (Employer Identification Number)?
An EIN or Employer Identification Number works as a Social Security Number for your business. An EIN is a unique 9 digit identification code issued to businesses, by the Internal Revenue Service (IRS) of the U.S.S., for tax filing & reporting purposes.
Are EIN, FTIN & FEIN the same?
An Employer Identification Number (EIN) is also called a Federal Employer Identification Number (FEIN) or a Federal Tax Identification Number (FTIN). So, there is no difference between these three.
Why Does a Business Need EIN?
An LLC will require EIN for the following reasons:
- To file Tax returns – EIN makes it easy to file the tax returns with the IRS. The IRS uses EIN to supervise all the business finances of the LLC.
- To Hire Employees – To hire employees in the LLC, an Employer will need the EIN. EIN lets the employers set the payrolls of the employee fo every month. IRS tracks the employee’s payroll taxes with the help of the EIN.
- To maintain the corporate veil – In an event where someone has sued the LLC or has filed a lawsuit against it, the EIN protects members’ assets. EIN is an essential part of the company’s corporate veil, which differentiates the business entity from its members.
- To protect the individual Identity of the member – The Limited Liability Company uses EON for all its taxation & finances. Nowhere in the financial process does an LLC use an individual’s Social Security Number; hence the Identity of individual members is kept safe.
- To open a business bank account – Without the EIN, an LLC can’t open a business account. It is essential to get an EIN even for the business credits & business licenses.
When Does IRS Ask for EIN (Employer Identification Number)?
The taxation documents & reports are filed with the IRS, which requires an LLC about its EIN in the following circumstances.
- An EIN is mandatory for an LLC with employees for tax filing & tax returns.
- If the LLC is a multi-member business entity, EIN is required for drawing the partnership return files.
- An EIN is also asked for excise tax filing.
EIN for a Foreign Entity or Foreign LLC
If someone is a foreign person or if the LLC is a foreign LLC, EIN allows them to start the LLC even without the Social Security Number. EIN allows the member of the foreign LLC to collect a payment, distribute the cash in the company & out of the company, hire employees & report or file taxes.
How to Obtain EIN for a Foreign LLC or a Foreign-Owned Corporation?
Following is a step-by-step guide for obtaining an EIN for a Foreign LLC:
- Eligibility – Any person applying for the EIN must have a valid Taxpayer Identification Number, e.g., SSN or ITIN; only then can he apply for EIN.
- FORM SS-4 – If a foreign entity does not have a Tax Identification Number, it will have to fill-up the Form SS-4, an EIN application. This form is for foreign applicants who do not have a social security number or a physical address
- Filing the form with the required information – To be able to apply for the EIN, the following information has to be filled out correctly in the application form:
– Legal Name & Address of the Business
– The type of Business Entity
– Reason for the application for an EIN- The name of the country where the business is incorporated
– Number of employees
– The industry in which the LLC does its business
– Accounting Information
- Ways to apply for EIN North Carolina–
- Online – An EIN can be obtained by applying online on the IRS website.
- By phone – A foreign entity or LLC can apply for EIN by calling on 267-941-1099, which is NOT a toll-free number.
- By Fax – An EIN can also be obtained by fax. The LLC willing to obtain the EIN can fax Form SS-4 to 304-707-9471
- By Mail – A completed form can be mailed to the Internal Revenue Service (IRS), Attn: EIN Operation, Cincinnati, OH 45999.
Restriction In Business For Foreign Entities In North Carolina
According to North Carolina’s Limited Liability Company Act, foreign LLCs must register their foreign corporation with the Secretary of State Office, North Carolina to transact business in the state.
Transacting Business In The State of North Carolina
The subject of taxation of the foreign LLCs should also be duly considered after the incorporation of LLCs. According to state rules, foreign LLCs must collect state sales taxes in their home state. A company must have a physical presence in—or a connection with—the state to be liable to collect state sales tax on sales to its residents. If a foreign LLC opens a store, an office, or a warehouse in North Carolina, or hires a sales representative there, it is regarded to have a physical presence in the state.
Registering The Business
To register a foreign business LLC in the State, the LLC must submit a North Carolina Certificate of Authority to the Corporations Division of the North Carolina Secretary of State.
The North Carolina Secretary of State requires a certificate of good standing or its equivalent from the home state in order to approve a foreign qualification application. The foreign entity must also appoint a registered agent in North Carolina on file at all times. In North Carolina, annual reports are due 3.5 months following the end of the tax year, which is generally April 15th.
Effect Of Non-Registration
A foreign LLC doing business in North Carolina shall be prohibited from filing any action, suit, or proceeding in the state until it has registered and paid all fees for the time it did business there without being registered. The LLC will also be responsible for fees, taxes, and penalties. A civil penalty of up to $10 per day for each day business is transacted without a certificate of authorization, up to a maximum of $1,000 per year, can be imposed on such business LLCs.
However, the lack of a certificate of authority has no bearing on your LLC’s contracts or its ability to defend a case in North Carolina.
North Carolina Deceptive Trade Practices Law
North Carolina, unlike many other states, does not follow the Uniform Deceptive Trade Practices Act. Unfair methods of competition in or influencing business; and Unfair or deceptive actions or practices in or affecting commerce are among the behaviors that are prohibited under North Carolina’s deceptive trade practices statutes.
A defrauded consumer can sue a violation in civil court, and the State Attorney General can prosecute them in civil court.
How Fast Can You Obtain EIN for Foreign LLC in North Carolina
An EIN for foreign LLC in North Carolina can be obtained by immediately if applying online and by mail or fax it may take up to 1 week.
How can you obtain an EIN for your foreign LLC in North Carolina? There are two ways to apply: paper and fax. The former is a quick and convenient way to apply for a business license. If you choose the latter, you must be aware that the fax number may change without any notice. A paper form can take four to six weeks before receiving a response from the state service center.
An operating agreement is an important legal document for your LLC. It defines who owns the company and how the business operates. It’s best to create a comprehensive operating agreement so that all owners are on the same page, reducing the chance of conflict in the future. In addition to the operating agreement, an EIN is also a requirement for hiring employees, setting up retirement plans, and filing taxes.
You may want to start the process by obtaining an EIN from the state in which you intend to do business. In North Carolina, a certificate of good standing is required. If you’ve recently opened an LLC in another state, you’ll need this EIN for foreign business licenses and to renew certain business permits. To get a North Carolina EIN, visit the Secretary of State website.
If you’re looking to open a new business, an EIN is essential. While obtaining an EIN can be time-consuming, it is important to get the proper authorization before starting a business in the U.S. It’s important to note that the EIN process may not be as simple as one might think, so don’t be discouraged if you’re not familiar with it. You can find the answer to this question by following the steps below.
Once you’ve got your EIN, you’ll need to file the application with the state’s Secretary of State. You’ll need to pay a state filing fee of $125. To complete your application, you’ll need to include the Certificate of Legal Existence and Certificate of Good Standing. Your application will take approximately two weeks. You can then begin conducting business in North Carolina.
Before filing your application, you should have an operating agreement prepared. This document outlines the formalities of your LLC. It also details the annual meetings and governing documents. To establish an LLC, you need to file the articles of organization, operating agreement, minutes of the organizational meeting, and obtain the EIN. Many banks require an EIN to open a bank account, so you should obtain yours before proceeding.
Before you file the application, you should check to see if the name you want is available. If it is, you can reserve the name and fill out an application. Names can be reserved for up to 10 years. If you’re not sure if your name is available, check if it’s already registered with another company. In either case, you’ll have to file the application.
To obtain EIN for your foreign LLC, you have to apply for it from IRS. Fill up the Form-SS4 and send it via phone, fax mail or submit it online.
If you’re a self-employed individual then you do not have to obtain EIN, you can use your social security number to form an LLC.
EIN and TIN (Tax Identification Number) are the same things. IRS issues both the identification numbers to the businesses. It is an eight-digit identification number issued by the IRS.
It is not mandatory to have a third-party designee obtain EIN. A third-party designee is an individual appointed by the LLC. That person will be responsible for fill-up the form SS-4 by answering all the questions and also can receive the issued EIN if applied by phone.
Obtaining EIN for any North Carolina foreign LLC is a must. This number is required to conduct business, open up a business bank account, report the Taxes to IRS, and so on. EIN is any business entity’s Social Security Number that is mandatory to transact business.