To obtain EIN for South 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 South 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 South 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 South 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 South 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 South Carolina
The foreign LLCs in South Carolina are required to mandatorily register themselves with the State of South Carolina if they are “transacting business” in South Carolina, according to South Carolina’s LLC regulations.
Transacting Business In South Carolina
Further ahead, post the incorporation of foreign LLC, their position with regards to the subject of taxation must be addressed. According to state rules, foreign LLCs must collect state sales taxes in their home state. For a foreign LLC to be liable to collect state sales tax on sales to its residents, the company must have a physical presence in—or a connection with—the State. If a foreign LLC opens a store, an office, or a warehouse in South Carolina or hires a sales representative there, it is regarded as having a physical presence.
Registering The Business
The South Carolina Foreign LLC must file an Application for Certificate of Authority with the South Carolina Secretary of State, Business Filings Division, in order to register a foreign corporation in South Carolina.
The Secretary of State Office in South Carolina requires a Certificate of Existence or Good Standing issued by the home state to approve a foreign qualification application. The foreign LLC must also hire a registered agent in South Carolina who shall act as the official communicator between the firm and the Secretary of State office.
The Secretary of State requires an initial annual report when filing for-profit corporations alone. The Secretary of State does not require an annual report.
Effect Of Non-Registration
If a South Carolina foreign LLC starts its business operations in the State without registration, then such entity may have to face the following consequences as per the South Carolina Code of Laws, Title 33, Chapter 15, Article 1, Section 33-15-102:
- Such a business LLC shall be barred from taking any action, filing a suit, or maintaining a proceeding until it has registered and paid all fees for the time it performed business there without being registered.
- The State’s Court of Law may also stay all the proceedings concerning such a business LLC until the firm obtains the certificate.
- Such foreign Corporation may also be liable to civil penalties to the tune of $10 per day and upto $1000 in each year. The Attorney General may collect all the penalties and fines imposed on the LLC.
- However, the LLC’s contracts will not be invalidated or prevented from defending a lawsuit in South Carolina even though it is not registered.
South Carolina Deceptive Trade Act
The South Carolina Unfair Trade Practices Act regulates the business practice standards to be implemented in the State. It strictly prohibits any deceptive behavior, misrepresentation to consumers, fraud, etc. The Unfair Trade Practices Act forbids unfair competition and unfair or deceptive actions or practices during any business activities, and it targets both consumer protection and anti-competitive behavior.
Attorney general, any individual who has suffered a determinable loss, the solicitor, the county attorney, or the city attorney, with the attorney general’s prior consent, may file a lawsuit in state court against the offender.
How Fast Can You Obtain EIN for Foreign LLC in South Carolina
An EIN for foreign LLC in South Carolina can be obtained by immediately if applying online and by mail or fax it may take up to 1 week.
Obtaining EIN for Foreign LLC in South Carolina is a process that depends on a few factors. Typically, it takes about two weeks for a foreign LLC to receive a Certificate of Authority. This allows a foreign LLC to transact business in South Carolina. However, the process may vary depending on the type of company and the services offered by the state. Typically, a foreign LLC may be required to hire a registered agent, a company or individual who can act on behalf of the LLC. A registered agent is responsible for receiving legal mail on behalf of the LLC.
Foreign companies must file a Certificate of Authority with the South Carolina Secretary of State. This certificate of authority serves as proof that the company has paid all required fees. If the company does not file the certificate of authority, it is considered to be unregistered and barred from taking action. The company may be subject to fines and penalties of up to $1000 per year. It may also be barred from taking action in state court. If the company is not registered, the Attorney General may file a lawsuit against it. The Attorney General may also seek to collect penalties from the company.
The application process for foreign LLCs in South Carolina is typically easier than a domestic LLC. In addition to the application process, foreign companies must hire a registered agent to conduct business in the state. If the company has a physical presence in the state, it may also be able to hire a sales representative. A registered agent is usually a corporation or individual who is authorized to conduct business in the state. The registered agent is the official communicator with the Secretary of State office.
Applicants can submit their applications by mail or online. Mail applications can take up to two weeks to process. However, an online application can be submitted much faster. It is also less likely to be rejected. Applicants can also submit their applications via traditional fax. In some cases, the application process may take as little as one to two business days.
Foreign LLCs in South Carolina may be required to pay a $110 filing fee. The filing fee is based on the capital stock of the corporation. The amount of the fee is also based on the company’s paid-in surplus. However, if the corporation’s capital stock is less than $10,000, the fee will be reduced. Applicants can also apply for expedited service, which will take just one to two business days. In addition to the fee, the applicant must submit two copies of their documents.
Foreign LLCs in South Carolina may also be required to file an Application for Amended Certificate of Authority. The filing fee for an amended certificate of authority is $110. However, this process can also take one to two business days. A foreign LLC may also be required to hire a registered agent in South Carolina, a company or individual who can act as an official communicator with the Secretary of State’s office.
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 South 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.