Businesses whose primary contact information has changed may receive a letter from the IRS prompting them to update their applications for Employer Identification Numbers.
The IRS requires EIN holders to update responsible party information within 60 days of any change by filing Form 8822-B. One reason for this is so that the IRS has accurate records of who to contact for identity theft issues.
As a result, the IRS intends to step up its awareness efforts aimed at businesses, partnerships, trusts and estates, charities and other entities that are EIN holders.
The IRS will begin sending letters this month to approximately 100,000 EIN holders where it appears the responsible party listed on the application is outdated.
All EIN applications must disclose the name and Taxpayer Identification Number (Social Security number, Individual Taxpayer Identification Number or EIN) of the true principal officer, general partner, grantor, owner or trustor. The responsible party is defined as the individual or entity who “controls, manages, or directs the applicant entity and the disposition of its funds and assets.”
Unless the applicant is a government entity, the responsible party must be an individual, not an entity. 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.
Please let us know if you have any questions or need more information.
Rebecca Friend is a Senior with our Business & Tax Advisory Group. She can be reached at firstname.lastname@example.org.