BOOKKEEPING TIPS is a twice monthly e-letter published by The American Institute of Professional Bookkeepers (AIPB), Suite 500, 6001 Montrose Road, Rockville, MD 20852. Tel.: 800-622-0121, Fax: 800-541-0066, email: info@aipb.org.

June 1, 2005

When Must A Company Get a New EIN/TIN?

Every day we get calls from our bookkeeper-members on AIPB's free member AnswerLine, where we answer bookkeeping, accounting and payroll questions free. This is just one benefit of membership in AIPB. (To find out about your other member benefits, visit www.aipb.org/member_benefits.html.)

Because we get questions on EINs and TINs so often, we created the following guide for members and published it in The General Ledger, the free monthly technical briefing for members only (www.aipb.org/general_ledger.html).

Here are the rules:

Sole proprietors must obtain a new EIN:
- when subject to bankruptcy proceedings
- when they incorporate
- when they take in partners
- when they purchase/inherit a business

Sole proprietors do not need a new EIN:
- when they change the business’s name
- when they change or add locations
- when they operate multiple businesses

Partnerships must obtain a new EIN:
- when 50% or more of the ownership changes within a 12-month period
- if they incorporate
- if they are taken over by a partner and operated as a sole proprietorship
- if they end and a new one begins
- if they declare bankruptcy

Partnerships do not need a new EIN:
- when the partnership name changes
- when they change or add locations

Corporations must obtain a new EIN:
- when they receive a new charter from the sec’y of state
- when they become subsidiaries of another corporation
- when they change to partnerships or proprietorships

Corporations do not need a new EIN:
- when they are divisions of another corporation
- when they declare bankruptcy
- when the corporate name changes
- when the corporate location changes
- when a C corp chooses to be taxed as an S corp
- when their reorganization changes only the identity or location

If you are a professional bookkeeper, we urge you to join 30,000 bookkeepers in the national association and certifying organization for your profession, The American Institute of Professional Bookkeepers (www.aipb.org).

Join today and get your first monthly technical briefing, the June issue of The General Ledger, with important June updates for you on:

Changes that make flexible spending accounts (FSAs) more valuable by making the cost of nonprescription drugs (antacids, allergy medicines, pain relievers, cold treatments, etc.) reimbursable by an FSA—and when these reimbursements might be taxable

Why you no longer have to submit suspicious W-4s to the IRS—but why you may get an IRS notice anyway

Why fees for lines of credit are tax deductible

Fast-spreading, strict new laws on “SUTA dumping" (see if your state is mentioned in this issue of The General Ledger)

10 vital tips on W-4s from Ernst & Young that will help you avoid IRS penalties

Why the IRS will scrutinize your fringe benefits to highly paid employees if your company is audited for any reason (even one that has nothing to do with fringe benefits)

Why a new court case could let you off the hook as a “responsible person” for employment taxes—even if you sign company checks

A monthly bookkeeper’s skills-and-knowledge quiz (do you know the answers?)

Why miss important bookkeeping, accounting or tax news that affects your job, your company or your clients? Connect with 30,000 bookkeepers in the national association and certifying body for your profession. Join today at: www.aipb.org/member_benefits.html
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