How To Get A EIN (Tax ID) Number In Minnesota
Minnesota has the 9th highest business-friendly environment in the country, and starting a business in this state gives you access to a great workforce and relatively low business taxes. Additionally, Minnesota is considered to have one of the lowest stress levels of any state in the country.
However, even in a low-stress, business-friendly state, you still have to jump through a few regulatory hoops when you start a business. One of the first things you need is a Minnesota EIN number and a state tax number. Worried about the process? Then, keep reading — this guide is designed to help.
To get a Minnesota tax ID number and an EIN number Minnesota residents should do the following.
How To Apply For A Tax ID Number In Minnesota
To apply for an EIN number in Minnesota, you only have to prepare some details for the EIN application. Then, you need to fill out the application and send it to the government. Take a closer look at the details below.
Prepare The Required Information
Applying for an EIN is relatively straightforward. The SS-4 form is only a page long, and it doesn’t request very complicated information. You will need your business name, address, type of entity, and principal line of business, but you will also need to answer the following questions:
- Who is the responsible party for your business? This must be someone who can make financial decisions for the business and has a right to the business’s assets. In contrast, when you select a nominee or agent for LLC formation, they don’t have to own part of the company. Be careful not to confuse these concepts.
- Why do you need an EIN? The most common reasons are hiring employees, opening bank accounts, applying for loans, or changing the structure of your business. You also need an EIN if you take over an existing business.
- How many people do you plan to hire in the next 12 months? Do you have any agricultural or household employees? There are slightly different reporting requirements for household and ag employees.
- Do you want to opt to file payroll returns once per year instead of quarterly? You should only answer yes if you anticipate paying less than $5,000 in wages.
Once you gather these answers together, you can continue to the next step. You can choose between applying online or through the mail, and there are detailed instructions for both below.
To apply for an EIN number online, you need a steady internet connection and about 30 minutes. Then, you simply enter the above information and wait for the application to issue you a number. Once issued, the number never expires, and you can start using it right away.
Submit Your Application Via Mail
If you have six to eight weeks, you can request your EIN through the mail. To get a mailed EIN number Minnesota residents need to enter the above details into a paper application. Then, they should mail it to the IRS and wait for a response. Alternatively, you can use a fax to submit your application. You cannot apply over the phone unless you’re based in another country.
Frequently Asked Questions
Before applying for an EIN number Minnesota residents may have additional questions. Here are the most commonly asked questions about this process in the Land of 10,000 Lakes.
An EIN is an employer identification number. It’s used on federal payroll returns, partnership returns, and corporate returns. You need this number if you want to hire employees, form a partnership or corporation, or pay excise taxes. You also need it to open business bank accounts or loans.
No, the Secretary of State does not issue EINs. The IRS issues EINs. The Minnesota Department of Revenue issues state tax ID numbers.
A Minnesota EIN number is a federal tax ID number used by businesses in Minnesota on federal tax forms. A Minnesota tax ID number, in contrast, is a state number used on state tax forms. These numbers are not the same, but they serve similar purposes.