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Checkbook llc8/26/2023 This individual or entity, which the IRS will call the "responsible party," controls, manages, or directs the applicant entity and the disposition of its funds and assets. All EIN applications (mail, fax, electronic) must disclose the name and Taxpayer Identification Number (SSN, ITIN, or EIN) of the true principal officer, general partner, grantor, owner or trustor. The IRS does not authorize the use of nominees to obtain EINs. The use of nominees in the EIN application process prevents the IRS from gathering appropriate information on entity ownership, and has been found to facilitate tax non-compliance by entities and their owners. Rather, nominees are temporarily authorized to act on behalf of entities during the formation process. The Internal Revenue Service has become aware that nominee individuals are being listed as principal officers, general partners, grantors, owners, and trustors in the Employer Identification Number (EIN) application process. The "responsible party" is the individual or entity that controls, manages, or directs the entity and the disposition of the entity's funds and assets, unlike a nominee, who is given little or no authority over the entity's assets. The "principal officer, general partner," etc., as defined by the IRS, is the true "responsible party" for the entity, instead of a nominee. ![]() NomineesĪ "nominee" is someone who is given limited authority to act on behalf of an entity, usually for a limited period of time, and usually during the formation of the entity. The ability to fund the entity or the entitlement to the property of the entity alone, however, without any corresponding authority to control, manage, or direct the entity (such as in the case of a minor child beneficiary), does not cause the individual to be a responsible party. or (d) a grantor, owner, or trustor if a trust.įor all other entities, "responsible party" is the person who has a level of control over, or entitlement to, the funds or assets in the entity that, as a practical matter, enables the individual, directly or indirectly, to control, manage or direct the entity and the disposition of its funds and assets. For example, (c) if a corporation is the general partner of a publicly traded partnership for which Form SS-4 is filed, then the responsible party of the partnership is the principal officer of the corporation. If there is more than one responsible party, the entity may list whichever party the entity wants the IRS to recognize as the responsible party. Additionally, entities must report any changes to the responsible party to the IRS within 60 days by using Form 8822-B, Change of Address or Responsible Party – Business PDF.Īccording to the Instructions for the current revision of the application, the "responsible party" is defined as follows:įor entities with shares or interests traded on a public exchange, or which are registered with the Securities and Exchange Commission, "responsible party" is (a) the principal officer, if the business is a corporation, (b) a general partner, if a partnership, the general requirement that the responsible party be an individual applies to these entities. Unless the applicant is a government entity, the responsible party must be an individual (i.e., a natural person), not an entity. If you choose to do business with this business, please let the business know that you contacted BBB for a BBB Business Profile.Īs a matter of policy, BBB does not endorse any product, service or business.All EIN applications (mail, fax, electronic) must disclose the name and Taxpayer Identification Number (SSN, ITIN, or EIN) of the true principal officer, general partner, grantor, owner or trustor. BBB Business Profiles are subject to change at any time. When considering complaint information, please take into account the company's size and volume of transactions, and understand that the nature of complaints and a firm's responses to them are often more important than the number of complaints.īBB Business Profiles generally cover a three-year reporting period. However, BBB does not verify the accuracy of information provided by third parties, and does not guarantee the accuracy of any information in Business Profiles. ![]() BBB asks third parties who publish complaints, reviews and/or responses on this website to affirm that the information provided is accurate. BBB Business Profiles may not be reproduced for sales or promotional purposes.īBB Business Profiles are provided solely to assist you in exercising your own best judgment.
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