About Form 1028
An EIN serves several critical functions for businesses, including:
1.Tax Filing: Businesses need an EIN to file federal tax returns, including income tax, employment tax, and excise tax returns.
2.Bank Accounts: Opening a business bank account requires an EIN.
3.Hiring Employees: To hire and pay employees, a business must have an EIN to report employment taxes.
4.Compliance: An EIN is necessary to comply with various state and federal regulations.
5.Business Credit: Establishing business credit often requires an EIN.
Who Needs to File Form 1028?
The following entities typically need an EIN and thus need to file Form 1028:
How to Complete Form 1028
Although the IRS now primarily recommends applying for an EIN online, understanding the traditional paper form process via Form 1028 can be beneficial. Here is a step-by-step guide:
1.Entity Information: Provide the legal name of the entity, the trade name if applicable, and the mailing address.
2.Type of Entity: Indicate the type of entity applying for the EIN (e.g., sole proprietorship, corporation, partnership).
3.Reason for Applying: State the reason for applying for an EIN, such as starting a new business, hiring employees, or opening a bank account.
4.Date Business Started: Specify when the business was started or acquired.
5.Closing Month of Accounting Year: Indicate the closing month of the accounting year (usually December for most businesses).
6.Principal Activity: Describe the principal activity of the business.
7.Principal Officer’s Information: Provide the name and Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) of the principal officer, general partner, grantor, owner, or trustor.
Submission and Processing
The traditional method of submitting Form 1028 involves mailing the completed form to the IRS. However, the IRS strongly encourages online applications, which are processed immediately, and the EIN is assigned instantly. For those who prefer paper applications, processing times can vary but generally take about four weeks.
