Watch before LLC registration! 🚨 Dodge 3 common blunders & secure your EIN properly! 💼💡#LLCTips

Avoid these 3 mistakes when getting the EIN number for your business. First, when you go to the IRS website, you must make sure to select the correct entity structure. So if you're an LLC, then you must choose LLC as the entity type. And if you're a sole proprietor, then you must not choose LLC, and instead you'll choose sole proprietor or individual. Also keep in mind, if you switch from a sole proprietor over to an LLC, and you can't use your existing EIN number. You will have to get a new one for the LLC. Second, you'll want to make sure that the state approves the LLC and the LLC name prior to getting the EIN number. Sometimes the state will reject the LLC application for having a name conflict, and if you already got the EIN number for the business, then you're either gonna have to update the IRS with the new name, which can take several weeks, or get a new EIN number. And the third mistake is that the applicant does not list the proper number of owners in the LLC. If the LLC has multiple owners, then you must list the number of owners on the EIN application. However, keep in mind, if you live in a community property state and the other owner is your spouse, then you can tell the IRS that the other owner is the spouse, and the IRS can then still treat the LLC as a disregarded entity rather than a partnership, which can help you from a tax perspective. And one last bonus mistake that I see people making is that they go to a third-party website rather than the IRS website, and they end up paying $100 or more to get the EIN number for the business when they could have gotten it for free from the IRS website and received it instantly.