If you have a side hustle, you might be wondering if you need a tax ID number, also referred to as an EIN or FEIN. In this video, I’ll discuss whether or not you should get an EIN or employer identification number for your side hustle business.
An EIN is a nine digit number assigned to sole proprietors, corporations, partnerships and LLCs, for tax filing and reporting purposes. It’s a permanent number issued by the IRS, and that is how they identify your company.
As a side hustle business owner, you’re most likely taxed as a sole proprietor. And, since sole proprietors and single member LLCs report their business income on their personal tax returns, they’re NOT required to obtain a tax ID number unless they have employees or a qualified retirement plan.
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? I’m an Illinois-licensed, Registered Certified Public Accountant with over 25 years of experience. I’m dedicated to providing outstanding tax and accounting services to individuals and small businesses in the Chicago area.
Disclaimer: Any accounting, business or tax advice contained in this article, is not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties. If desired, I would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired consultation services.
