According to the IRS, Sole Proprietors are required to obtain a new EIN when they (1) incorporate; (2) take on partners and then operate as a pertnership; (3) are involved in a bankruptcy; or (4) either purchase or inherit an existing business which is then operated as a sole proprietorship.
WHAT IS THE EIN?
Also known as the Tax Identification Number (TIN), Federal Employer Identification Number (FEIN) or the Federal Tax Identification Number, the EIN is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to business entities operating in the United States for the purposes of identification. When the number is used for identification rather than employment tax reporting, it is usually referred to as a TIN, and when used for the purposes of reporting employment taxes, it is usually referred to as an EIN. This website uses the latter term throughout.
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