How to get a tin number in texas

Any business that operates in Texas needs a state tax ID number in addition to licenses and permits. This unique identifier is necessary for filing tax returns, handling employee payroll and obtaining business loans. Entrepreneurs can apply online for a tax ID in Texas or obtain it through the state agencies with which they are doing business.

If you're doing business with a state agency in Texas, fill out the AP-152 form to receive your tax ID number. Another option is to apply for a business permit, such as a sales tax permit. Your tax identification number will be issued once your application is processed.

Why Get a State ID?

Whether you operate as a sole proprietor, a partnership or a limited liability company, it's necessary to pay federal taxes. To do so, you must register with the IRS and obtain a federal tax ID, or employer identification number. Once this step is completed, you may open a bank account, apply for business licenses, hire employees and so on.

Entrepreneurs are legally required to obtain an EIN immediately after registering their business (assuming they're not a one-man business). They also need to apply for a state tax ID number, such as a Texas taxpayer number. Tax obligations vary among states, which is why it's important to get a state ID where your business is located.

The Texas taxpayer number, or TIN, has 11 digits, while the EIN has nine digits. The former is assigned by the state's comptroller and serves the same purpose as the federal tax ID number. Your EIN, on the other hand, will be assigned by the IRS. As an entrepreneur, you need both state tax ID and federal tax ID numbers to run your business, file tax returns, pay wages, get a tax-deferred pension plan, open investment accounts and apply for business licenses.

Application for a Tax ID in Texas

There are several ways to get a tax ID in Texas. If you're doing business with the state, the government agency in question will provide you with the AP-152 form. Be prepared to submit your Social Security number, EIN or individual taxpayer identification number, also known as an ITIN. Fill out and print the form and then submit it to the state agency with which you're doing business.

A state agency representative can complete the form on your behalf, as your signature is not required. Nonresident aliens and businesses located outside the U.S. may not have an SSN, ITIN or EIN. In this case, the agency may request a comptroller-assigned TIN for your business.

Complete the AP-201 Form

Business owners can also obtain a tax ID in Texas when they register for a sales tax permit or other permits. This unique identifier is used for paying sales and use tax, excise taxes and more. The sales and use tax, for example, is required for all individuals and businesses that sell or lease tangible personal property or taxable services in the state. Remote sellers and businesses that sell, lease or rent taxable products in Texas or collect tax on certain services and goods need this permit too.

Applying for a sales tax permit is free of charge. Access Comptroller.Texas.gov, select "Taxes", click "Texas Sales and Use Tax Forms" and then fill out the form AP-201. You will be required to provide the following information:

• Business organization type
• Legal business name
• Federal employer identification number
• Social Security number (for sole proprietors)
• Texas identification number (TIN)
• NCAIS (North American industrial classification system) code
• All general partners, officers or managing members and their legal information
• Place of business
• Contact details

If you don't have a Texas identification number, you will receive one as soon as your application is processed. Submit the AP-201 form online or mail it to the Comptroller of Public Accounts, and you should receive your permit within four weeks. In case you need help with your application, call 800-252-5555 or submit your question online via Comptroller.Texas.gov. Another option is to apply for a sales tax permit (and thus get a tax ID number) in person at a local field office.

It's not enough to register your business and acquire a federal tax identification number. You also need the right permits, licensing and tax registrations to be compliant with federal, state and local regulations. Most new businesses obtain an IRS federal employer identification number (EIN) for tax filing, but states assign special tax numbers as well. Once you've received an EIN, check your state franchise tax board to obtain the proper state tax identification numbers required by your state to operate your business.

Employer Identification Number

A state employer identification number is different from an EIN. Obtain the EIN directly from the IRS by completing Form SS-4 online or by mailing it in. This is free. Online services are quickest, immediately issuing your EIN. Once you have that ID, keep it with your business registration book along with your articles of incorporation.

Procedures to get a state number vary from state to state. For example, the Texas Comptroller's Office uses an e-file system to assign this number. Submit your business's full legal name, federal EIN and pertinent contact information, and an 11-digit number will be assigned to your new business. In Texas, there is no fee to apply.

California, on the other hand, registers tax identification numbers through the Employment Development Department. Call 888-745-3886 or go to your local Employment Tax Office to register. Hawaii assigns numbers through the Department of Taxation and requires the filing of a completed Form BB-1. This is done via the online portal.

Check with your state comptroller or franchise tax office to confirm the forms and details you need.

Uses of the EIN

One of the primary reasons a business needs a state EIN is for payroll services. Paychecks and issued 1099s use both federal and state EINs to ensure proper tax withholding for the IRS and the state tax board. States vary in terms of state income tax and unemployment tax. You generally won't be able to establish payroll services until you have a state identification number.

You also use the state EIN to acquire any sales permits required for your business and make other franchise tax payments to your state. For example, Texas requires a sales tax permit for any business that sells tangible property, provides services or leases real property in Texas. There is no fee for the Texas permit, though other states might require one. Check with your secretary of state to confirm the permits and licensing required for business in your state.

Banking and EINs

Generally speaking, you'll use the business's federal EIN for any bank or credit application. In addition, many lenders will require your Social Security number and personal guarantees for business loans if you are a new small business. Even with the federal EIN, lenders conduct searches to confirm the business is a valid entity in the state. If a lender can't identify a state EIN or sales tax permit, it might exclude you from even getting a business checking account.

Make sure all business financial accounts are kept separate from personal funds. Commingling of assets often negates any liability protection provided by limited liability partnerships or corporations.

How much does a tax ID number cost in Texas?

How can I get my TIN number online?

How do I get an ITIN number in Texas?

Is TIN same as SSN?