You might be wondering whether you must register for an Employer Identification Number (EIN) from the Internal Revenue Service (IRS) if you are forming a Limited Liability Company (LLC) in the state of Washington. The answer is that it depends on your business’s type and whether you employ people.
The IRS uses an EIN, a special nine-digit number, to identify firms for tax purposes. It is needed for some tax forms and is also known as a Federal Tax Identification Number (FTIN). To file employment tax returns, such as Form 941, if you have employees, you will need an EIN. Even if you don’t hire anyone, you could still require an EIN for other tax-related activities like creating a company bank account.
You can apply for an EIN online through the IRS website in Washington State. It only takes a few minutes and is free. Information about your company, including its legal name, address, and entity type (LLC, sole proprietorship, etc.), must be provided. As soon as you get your EIN, make careful to store it safely because you’ll need it for next tax filings. Do I Need to Declare My Etsy Income? You might be wondering whether you have to declare your income on your tax return if you sell products on Etsy. Yes, you are required to include all income from Etsy sales on your tax return. This covers the price of the items sold as well as any costs paid to Etsy, including listing or transaction fees.
To sell on Etsy, you don’t need a different tax identification number. When you open a seller account, you must, however, submit your Social Security number or EIN. This data is needed to confirm your identification and for tax reporting purposes.
A listing fee of $0.20 per item and a transaction fee of 5% of the final selling price (including shipping) are levied by Etsy to its sellers. For optional services like promoted listings or Etsy Payments, there can be additional costs. Before selling products for sale on Etsy, be sure to review the platform’s fee structure and restrictions.
In conclusion, depending on whether you have workers or other tax filing obligations, you might need to register for an EIN if you’re creating an LLC in Washington state. When registering for a seller account on Etsy, you must enter your Social Security number or EIN and disclose all money made. A listing fee of $0.20 per item and a transaction fee of 5% of the final selling amount are assessed by Etsy.