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#2258820 - 08/26/21 09:22 PM Disregarded Entity
KerryVBC Offline
100 Club
KerryVBC
Joined: Oct 2007
Posts: 151
Colorado
I have a full understanding of how a disregarded entity account needs to be set up and how the W-9 needs to be completed (with the owner's name on line 1 of the W-9 and the owner's TIN being used).

However, I'm at a loss as to how to explain to my colleagues how a disegarded entity could conceivably have its own EIN but that it should not be used on the W-9. I know that it has something to do with whether or not the disregarded entity has employees, but that's it. Can someone please expand on this for me?
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#2258822 - 08/26/21 09:32 PM Re: Disregarded Entity KerryVBC
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 76,952
Galveston, TX
Yes - they would only need an EIN for payroll purposes. The W-9 instructions explain how to complete the form and what number for them to give you for a disregarded entity.

https://www.irs.gov/pub/irs-pdf/p1281.pdf

Encourage them to read it before asking further questions.
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#2258823 - 08/26/21 09:39 PM Re: Disregarded Entity rlcarey
KerryVBC Offline
100 Club
KerryVBC
Joined: Oct 2007
Posts: 151
Colorado
Thanks rlcarey. I knew it would be you that came through with the answer for me. I did show them the instructions and have gone over it ad nauseam; it seems almost too easy that an EIN is simply for payroll purposes and I just wanted to double-check that I wasn't missing a step somewhere.
Last edited by KerryVBC; 08/26/21 09:43 PM.
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