Russell and Associates - Forum

IRS.gov is a very helpful website – fairly well designed and full of useful, and sometimes scary (i.e. penalties and fines), information.

What we all must do as an employee or independent contractor or corporation is file the proper IRS tax forms when they are due.  Don’t be late or you may incur a penalty on top of what you owe.

A start to creating a business entity is to decide on what form that business will take – sole proprietor, independent contractor, limited liability corporation (LLC), S-Type Corporation, or a full-fledged C-Type corporation.

Many consultants would opt for the sole-proprietor or LLC – the simplest forms that require the least administrative overhead.  To limit personal liability you must choose other than a sole proprietor which requires registering with a State as a corporate entity.  All this info is covered at the IRS website and others (legalzoom.com).

The EIN, or Employer Identification Number, is a number you receive from the IRS that is associated with your business.  This allows you to use this number in place of your social security number.  Best news – it is FREE and VERY EASY to acquire.

Get your EIN here: http://www.irs.gov/businesses/small/article/0,,id=102767,00.html

Now, scroll down near the bottom of the page and click the Apply Online Now link text (or use CTRL-F and search for this text).

Click here to start the process to acquire your EIN

That is it – Just remember to ALWAYS use your IRS-issued EIN in place of your SS# whenever possible, file your requisite tax forms ON TIME, and enjoy your newfound freedom (and responsibility) as an entrepreneur!

Vic