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IRS Requires Tax ID Updates

May 24, 2013

Earlier this month, the IRS issued regulations which will require taxpayers with Employer Identification Numbers (EIN) to update their information with the IRS.  These regulations which take effect next year, will apply to everyone possessing an EIN on or after January 1, 2014.  This means these rules will apply retroactively and not only to individuals and businesses who will be applying for EINs after that date.

The IRS issues EINs to employers, sole proprietors, partnerships, corporations, nonprofits, estates, trusts, and other business entities for tax filing and reporting purposes.  Many EINs are being issued to individuals acting on behalf of the applicant but then are no longer authorized to represent the applicant.

To address this problem, the IRS revised Form SS-4, Application for Employer Identification Number, to require discloser of the applicant’s “responsible party.”  The recently issued regulations will require any person that has been issued an EIN to provide updated information to the IRS regarding their responsible party.  The IRS will publish a form for persons to use to disclose the correct application information.

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