Why You Need to Know the Difference Between FEIN and Tax ID

Business

Essentially, a FEIN and a tax ID number are the same. It is important to learn the small differences between the two so that you know what to do for your business or an entity such as a trust. When filing for a Trust tax ID Number or FEIN, knowing what each is for helps you to make the right decision when filing. The experienced associates at IRS-EIN-Tax-ID can help. 

A FEIN is a Federal Employee Identification Number and an EIN is an Employee Identification Number. Both numbers can be used to identify a business. The federal government does not recognize a FEIN and this number would not be used for federal tax filing. 

Small businesses will need to apply for a FEIN-EIN whether they have employees, or they do not. Having this number helps to avoid identify theft and protect the privacy of the business. 

To be able to report taxes to the IRS, a business must have a tax ID number. When you are the business owner, it is important to file for a tax ID or EIN to have this nine-digit identification number as it is required. A business also needs this number to be able to get a bank account or apply for credit for the business. 

The filing is easy when you take advantage of online service options. An application for an EIN can be completed online via IRS-EIN-Tax-ID.com. At the site, easily find the application for your business needs and fill out the appropriate paperwork. Once completed, you will need to hit the submit button. 

After your EIN has been assigned, the number will be emailed to you. Once you have the number, you will be ready for tax filing purposes as well as accessing lines of credit for your business, opening a checking account and more. 

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Is Your Home Business Organized?

Business

Is Your Home Business Organized?

Photo by CC user Unsplash on pixabay

Running a home business can be one of the greatest satisfactions in life.

For starters, you have the personal freedom of setting your own hours, thereby avoiding being on another person’s clock.

You also avoid potentially long commutes to work, thereby saving yourself gas money and ultimately wear-and-tear on your vehicle.

Finally, owning your own home business allows you to be the person calling the shots, especially as it relates to your clients.

While it is not uncommon for home business owners to have one or more part-time employees helping them, they still have final say over decisions.

So, it sounds like having your own home business is all positives and no negatives, yes?

While some may think that, true professionals know that is not the case.

All too often, home business owners will discover that they missed this or that financial matter, any of which can lead to issues with filing their taxes each spring.

They also know that they alone are responsible for finding their own healthcare insurance.

Unlike when you’re an employee of a company, wherein the HR department is typically responsible for such matters, home business owners take on that responsibility as well.

Is your home business organized as it can possibly be? If not, they can get some help along the way with all those financial and HR matters, reaching out to a professional employer organization (PEO) can make all the difference in the world.

Among the ways they can help:

  • Payroll services – This is one of the most critical aspects of your home business, especially when you have one or more part-time employees on your team. Those PT employees can provide a wealth of assistance to you, helping with tasks that you otherwise would be stuck doing. In return for their help, they of course need to be compensated. If doing payroll just takes up too much of your time, having the experts do it can prove a blessing;

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  • Workers comp – While the rules vary in most states, one thing is for certain. If you’re running a business and an employee of yours is injured on that property (or even someone coming to work on your property if it benefits your home business operation), he or she could file a workers compensation claim. What oftentimes gets smaller businesses (including some working out of homes) in trouble is either not having workers comp coverage altogether or trying to get around the law when it comes to filing etc. Yes, having the coverage and properly documenting when someone is injured working at your property can be expensive, but it is a much better alternative than trying to get away without the coverage and/or lying about a work-related accident. In one or both of those cases, your home business could very easily become financially strapped;

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  • Employee benefits – In most situations, employees are not eligible to obtain health insurance benefits when they do not work more than 30 hours a week. Some home business owners may hire one or more people to assist them in running their home company, albeit on a limited basis (a few hours a day or even just a few hours weekly). In some cases, however, a home business owner may determine he or she needs a FT assistant, perhaps even 35-40 hour a week. In those cases, the worker could be eligible for coverage. For those home business owners not up to speed on all the different HR requirements, having a PEO on their side makes sense.

If you’re searching for the right PEO as a home business owner, do your research before settling on one.

Look at how long the organization has been around, what services it offers, how business clients view its customer service initiatives, and what the costs would be to your home business in employing them.

Your home business could very well be the dream that you’ve had in the back or forefront of your mind for many years.

If that is the case, make sure you organize your dream as much as possible.

While running a home business takes lots of time and effort, the rewards (including financial ones) could set you up for the remainder of your life.

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