There is often a lot of confusion around requirements about a non-profit organization. How do these types of organizations handle things such as tax return filings? What do they need to do to do normal business transactions such as opening a business banking account? The answer is that they have to follow the same process as any other organization, even a limited liability company or LLC. You are going to have to get a Tax ID (EIN) number for the non-profit organization as early in its life as possible. Obtaining the employer identification number or EIN will set you up for an easier time performing normal business transactions and tax return filings later.
Steps to Getting a Tax ID (EIN) Number for your NPO
- Mandatory Information for the Non-Profit Organization
- Applying for the EIN Online For the Non-Profit Organization
- Alternative Non-Profit Organization EIN Application Methods
- Obtaining the Tax ID (EIN) Number
- Length of Time for Processing
Once you realize that you need an employer identification number for the non-profit organization, you need to gather information. What are some of the big-ticket items the Internal Revenue Service will care about? For an employer identification number generation to take place, what is the required information you need to have on-hand and ready to go. A few of the details you need for the non-profit organization will include:
- The legal name of the non-profit organization
- The principal address non-profit organization
- The date the non-profit organization formed
Another big part of getting together all of the mandatory information for the non-profit organization includes the naming of the responsible party. The responsible party will be helping with the completion of the application form for the Tax ID (EIN) number. They will also be putting in their information to represent the non-profit to the Internal Revenue Service. Information on this individual will include:
- The person’s full legal name
- Date of birth of the individual and legal address
- The person’s Social Security Number or Individual Taxpayer Identification Number
The easiest way to obtain the employer identification number for the non-profit organization is to apply online. The online application process for an employer identification number or EIN is an important one to be aware of. There are a lot of benefits to going this route and many of these benefits are detailed here. The benefits will include:
- The amazing speed of online processing. When you apply online, you will be able to complete the online application form is usually less than fifteen minutes in total.
- The fast response from the Internal Revenue Service will also tell you right away if they have all of the information they need, or if they need additional details.
- The assistance you can get from a Tax ID service provider is also worth mentioning. They can help you with each phase of the application online.
There are some alternative methods of applying for a Tax ID (EIN) for your non-profit organization. These alternative methods will include applying for the identifier via the mail, fax, or over the phone. Details on each of these application methods include :
- The mail application method requires you to fill out the full physical application form. Once you fill it in with all of the mandatory details you will then put it into the mail to send to the Internal Revenue Service.
- The fax application method is similar to the mail path. You need the physical form. Make sure the form you have is the most up to date as well. Once you fill everything out you will fax it to the Internal Revenue Service.
- The phone application method is just a starting point. You call in details to the IRS and then submit supporting documentation via other means.
The steps to obtaining an employer identification number are cut and dry once you get a grasp of the entire application process. When you want to obtain a Tax ID (EIN) number, you need to take your time and know the path forward before just jumping in. The standards steps include:
- The first step is getting together all of the mandatory business information. Once you have all of these details it is then you can move to the application phase.
- You need to decide as to how you are going to apply for the Tax ID (EIN) number. If you are applying online it is fast, while mail, fax, and the phone will take much longer.
- You need to complete the application form.
- Get assistance from a Tax ID service provider in form application completeness.
- Wait for the results so that you can have your employer identification number in-hand! The speed of when you get the results will depend on how you did the application process.
The length of time it will take to get your employer identification number will vary wildly. The application method is the driving force behind the processing time.
- Applying online will allow you to get your EIN for the non-profit organization in as little as one hour.
- Applying via fax is going to take around five to seven business days.
- When you apply by mail, it may take four to six weeks or even longer before you have your EIN.
When you think about a non-profit organization, you do need to treat it like you would any other organization. You are running a business, one that has no goal of turning a profit, but still a business where the end-state should always be an even keel of income and expenses. Getting a tax identification number or employer identification number (EIN) is important for any non-profit organization. Once you go through the application process and have the number in-hand being compliant with the Internal Revenue Service and doing business, in general, gets much easier.