The Etsy Blog

U.S. Tax Basics: Employer Identification Number

Etsy.com handmade and vintage goods

Jason, aka JJMFinance, a certified public accountant and certified treasury professional, has a passion for finances and teaching. He performs left-brain number-crunching analytics while also feeling like a right-brain handmade artist. His wife has been selling on Etsy since 2007, and he helps with bookkeeping, taxes and the legal side of her business. He built her a bookkeeping system and figured, “If my wife can use this, I’m sure other Etsy sellers could too!”  Jason is here to explain the basics of an Employer Identification Number (EIN) for your small, creative business.

Did you know that there is an equivalent of a social security number that is only for your business?

Some Etsy sellers will be able to run their business just by using their social security number, but sooner or later, you will probably want to have an EIN.

The good news is that it does not cost any money to get your EIN from the IRS and it is really easy, too! You can apply online in a matter of minutes and have a PDF file of your official EIN to use.

The EIN is often requested by banks when you are creating a new business checking account. Other businesses might ask for your EIN to confirm you are a legitimate business to enter into contracts with. The IRS can use this number to identify your business specifically.

Also, having an EIN for your business improves your personal identification security. Who wants to give some random person they barely know their social security number? I sure don’t — I feel more comfortable using an EIN instead. If your business expands, you will definitely need this number when you start hiring employees.

The IRS states, “Generally, businesses need an EIN.” This is true. When you are filling out the application, you will see the question, “Did you start a new business?” from the IRS. Most Etsy sellers will look at this question and answer, “Yes.” Congratulations — you just determined you do indeed need an EIN for your business. Plus, getting an EIN will not hurt anything — if you are unsure, go ahead and apply for one anyway.

So now that you have learned about the tax law, let’s spend 10-15 minutes and do it!

  1. Go to the IRS website to apply for an EIN. Click on “Apply Online Now.”
  2. Print out a hard copy of the EIN letter with your EIN on it. Also, electronically save this file somewhere safe. Note: It takes about 2 weeks for the number to be official.
  3. Use your EIN whenever it is required, and feel at peace that you have the major business identification number for the IRS.

Remember, knowledge drives out fear. No one tackles all the tax code at once! Tax code is best learned step by step. I hope this baby step has taken you closer to being at peace with your Etsy shop’s taxable requirements.

1 Featured Comment

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  • JJMFinance

    Jason Helping Your Etsy shop thrive from JJMFinance says: Featured

    A few clarifying points to address some of the comments above: - A EIN is one type of TIN (Taxpayer Identification Number). A SSN (Social Security Number) is another type of TIN. - Getting an EIN does not require you or force you to file any type of different taxes. It is simply a way for the IRS to identify your business. - For sole proprietors, no Etsy seller absolutely has to get an EIN - they can always just use their SSN. It is helpful for opening business bank accounts, provides you identity theft protection by not using your SSN, and is often required when filing for other licenses and business purposes. It is a lgocial step for a business to aquire an EIN. - Many sole proprietors have EIN's, even though they do not have any employees (not an employer). I encourage you to get your EIN today! Feel free to send me a convo to ask any specific tax related questions. Regards, Jason (JJMFinance)

    3 years ago

  • KKSimpleRegalJewelry

    Krista from TheBeadtriss says:

    Didn't know about that....

    3 years ago

  • thehappycouple

    Brianna from thehappycouple says:

    When I filled it out the final copy they gave me removed the "the" so it says I'm just Happy Couple, does that matter? I know that's a weird question. I'm really liking all these business operations related posts.

    3 years ago

  • JJMFinance

    Jason Helping Your Etsy shop thrive from JJMFinance says:

    Etsy sellers, feel free to send me a convo if you have personal tax, bookkeeping, or general finance/business related questions and I'll be glad to help you out the best I can! Regards, Jason (JJMFinance)

    3 years ago

  • JJMFinance

    Jason Helping Your Etsy shop thrive from JJMFinance says:

    Brianna (thehappycouple), here is the IRS telephone assistance page. I suggest you call them to followup about your missing "The" from your title. http://www.irs.gov/help/article/0,,id=96730,00.html

    3 years ago

  • mazedasastoat

    mazedasastoat from mazedasastoat says:

    Every year at this time I feel smug that here in the UK we have to have our tax returns in by the end of January! Jason, you're doing stirling stuff by providing this info, well done!

    3 years ago

  • OrientalGlory

    Grace D. from Graziacases says:

    Great!

    3 years ago

  • lovelymaid

    Sarah from LovelyMadeinNM says:

    This is so great, thank you!

    3 years ago

  • JulieAnnA

    Julie Ann from JulieAnnArt says:

    SO helpful. I need to do this now! Thank you!

    3 years ago

  • DebsDesignsBham

    Deborah Smith from DebsDesignsBham says:

    I just applied for my EIN! Thanks so much.

    3 years ago

  • kmarsh0000

    Kathy from CraftyPastimes says:

    Thanks -- you help is greatly appreciated!

    3 years ago

  • dolcedreams

    Nathalie DeSouligny-Blanco from dolcedreams says:

    Thank you so much! Really appreciated!

    3 years ago

  • SacsJolie

    SacsJolie from SacsJolie says:

    I have an EIN for my photography business. Can I use the same EIN for my Etsy business or do I need to get a new one? I also recently changed the name of my photography business. Do I need to change that with the IRS?

    3 years ago

  • theaterclouds

    Elly MacKay from theaterclouds says:

    Is there similar information about business rules in Canada that the wonderful folk at Etsy could share?

    3 years ago

  • SPAULEY

    Susan Pauley from SPAULEY says:

    Good to know. Thanks for being so helpful.

    3 years ago

  • MelliferaCandles

    Sarah Lyter from MelliferaCandles says:

    Thank you so much for the information!

    3 years ago

  • Jewelrybynala

    NaLa from jewelrybyNaLa says:

    Just got mine ... thanks so much for the information and the link, Jason!

    3 years ago

  • anisma

    Charlene Jaszewski from anisma says:

    it would be great if you could add some additional information to this article pertaining to * when would i NEED to have an EIN? * is there a downside to using an EIN (different tax rates, more complicated taxes, etc.) thanks!

    3 years ago

  • SolitaryPearl

    Christen Schneider from SolitaryPearl says:

    This was incredibly succinct and helpful! Thank you so much! I feel very official :)

    3 years ago

  • ron987red

    Deron Morrow from ron987red says:

    Have had one for sometime know

    3 years ago

  • ron987red

    Deron Morrow from ron987red says:

    Have had one for sometime now.

    3 years ago

  • eastbaycalifornia

    Jilliann Silva from eastbaycalifornia says:

    Looks like I'm going to apply! I've always wondered about this.. thanks!

    3 years ago

  • TulipSupplies

    Tasha Parrish from TulipSupplies says:

    Wow, fast and easy! So glad I could get one as a sole proprietor, I never realized... I'll feel much more comfortable filling out forms now. Thanks so much!

    3 years ago

  • PattieJansen

    Pattie Jansen from PattieJansen says:

    Extremely helpful, and "user friendly" explanation! Many thanks, Jason!

    3 years ago

  • mylittlepeeps

    Kathi Alderink from mylittlepeeps says:

    Jason, do you have to have an EIN and how much do you have to make before there is a tax obligation. I have yet to make even a thousand dollars in the last 18 mo. Do I need to file?

    3 years ago

  • MerCurios

    MerCurios from MerCurios says:

    I've always thought EIN numbers were for employee's being a sole proprietor with a DBA, I've always just used my social. My husband and I file our taxes together, however, this is the year we may be filing my business separately. What are the benefits to having an EIN # versus using your social, if any?

    3 years ago

  • miloglass

    Paula Buckley from miloglass says:

    Jason, Thanks for the useful information, I copied the sight for later use

    3 years ago

  • LuckyStarsHawaii

    LuckyStarsHawaii from LuckyStarsHawaii says:

    if I'm a sole proprietor and has no employees do I still need an EIN? I read that banks only need my SSN since I'm a sole prop.

    3 years ago

  • margarethenkel

    Margaret Henkel says:

    "Kathi Alderink from mylittlepeeps says: Jason, do you have to have an EIN and how much do you have to make before there is a tax obligation. I have yet to make even a thousand dollars in the last 18 mo. Do I need to file?" I'd love to know as well. Thanks so much for your help! Margaret

    3 years ago

  • HandmadeIsAllAround

    HandmadeIsAllAround from iammieOWLshop says:

    Is that for U.S. only? However, this article is interesting. Thanks for an update.

    3 years ago

  • LavenderField

    Victoria Letemendia Koupparis from LavenderField says:

    Thank you for sharing this. I don't have an EIN either.

    3 years ago

  • ErikaPrice

    Erika from ErikaPrice says:

    Interesting, but what about those of us who aren't in the US? In the past I've been asked for a tax number when purchasing supplies from US wholesalers, but I don't think we have the equivalent in the UK. Mind you, I'm nowhere near the threshold anyway, LOL!!!!!

    3 years ago

  • ZoeDuJour

    Zoe Clemmons from ZoeDuJour says:

    Fantastic! I've been wondering about this. Thank you.

    3 years ago

  • SaltCreekSoaps

    Carol Retzer Nikki Dekat from SaltCreekSoaps says:

    I already have EIN for Salt Creek Ranch. Can this be used for this "offshoot" business?

    3 years ago

  • JeJeweled

    Jema Watts from BadgeShack says:

    If you have an EIN number can you buy from wholesale companies who require a Tax ID number? Is this the same thing?

    3 years ago

  • trippingtiffies

    trippingtiffies from trippingtiffies says:

    "Kathi Alderink from mylittlepeeps says: Jason, do you have to have an EIN and how much do you have to make before there is a tax obligation. I have yet to make even a thousand dollars in the last 18 mo. Do I need to file?" I'd like to know as well. I thought you could just sell stuff you make just like you do on eBay? I didn't know there was an SS#, EIN and all that needed!

    3 years ago

  • dewdropdaisies

    Pam from dewdropdaisies says:

    I agree with all the questions about "When is this necessary?" I have yet to stick my head above that profit line. I keep waiting for that to happen before I actually made my Etsy shop "Official". Thanks for any further info. Pam :~)

    3 years ago

  • JJMFinance

    Jason Helping Your Etsy shop thrive from JJMFinance says:

    For the questions listed above, I will be sending you a convo as it is preferable to share specifics about your taxable situation privately and ask you specific follow up questions relating to your taxable situation to give you the best answer possible.

    3 years ago

  • junkgarden

    junkgarden from junkgarden says:

    I've had my EIN for awhile but great article. Good information!

    3 years ago

  • JJMFinance

    Jason Helping Your Etsy shop thrive from JJMFinance says:

    I have sent convos to each seller for the above questions as it is preferable to discuss your individual taxable situation privately and be able to ask applicable follow up questions, etc.

    3 years ago

  • kloster425

    Jeffrey Kloster from kloster425 says:

    I received an EIN, but am filing under my SS#... I am wondering if having an EIN will affect the tax filing process under my SS#. In other words, since I have an EIN, do I have to use it or can I continue using my SS# when I file my taxes. In addition... are their any benefits to using my SS# instead of an EIN. If anyone has any insight to this question, I would be greatly appreciate the knowledge you have to share.

    3 years ago

  • CourtyardCraftsGifts

    Cheryl Holland from CourtyardCraftsGifts says:

    EIN is a employer Identification number. If you file taxes as a sole proprietor you do not need an EIN. If you get an EIN, then you'll be filing a tax return when you may not need to! I would read the tax rules and regs for your state and not be jumping on getting an EIN number (which is federal) just because you think it necessary for you; chances are it isn't. Please speak with YOUR accountant or read the IRS regs for EINs before applying.

    3 years ago

  • CourtyardCraftsGifts

    Cheryl Holland from CourtyardCraftsGifts says:

    I'm concerned that after reading the comments above, lots of fellow Etsians are going to apply for an EIN. Please research your situation before doing so! An EIN is NOT an alternative to simply ID you business instead of a SS#. An EIN is for employERS. if you have an EIN you are required to file the appropriate tax returns on schedule. If you have employees, operate your biz as a corp or LEGAL partnership (not just along with your friend or spouse), file employment tax returns, have an specific Keogh plan or a charitable org or a trustee of a trust, etc. you should have an EIN. If you don't do any of those things (with a few others) you DO NOT need an EIN. If you do have an EIN you are required to file the appropriate tax returns as any employer does. Also, I'm always amazed that seller believe that you only report income from sales if over a certain amount! The IRS requires you to report ALL income whether $2 or $2M! In fact, the money you collect at your yard sales or gambling or bingo winnings is reportable too! EmployERS are the people who only report income paid to an individual when over a certain minimum amount. I.E. If you pay someone to work for you and you do not w/hold taxes on the individual but pay more than $600 in a calendar year, you should report the total payment to the IRS on a 1096 transmittal form and provide a 1099 form to the person paid. However, the person receiving the income is required to report ALL income received regardless of the amount and whether or not she received a 1099 form. Please folks, read up on EIN and reportable income rules; they are law and need to be followed.

    3 years ago

  • nicholsloy

    nicholsloy studio from nicsLeftEdge says:

    what a wonderful article! thank you so much for your unselfish sharing of this information. very clear. sloy & nic (nic's leftedge)

    3 years ago

  • twovirgos

    Paula and Bette from TwoVirgos says:

    Thanks, Jason. I got my EIN number. I understand that when I open a bank account or apply for Sales Tax number in my state I need an EIN number. Since it doesn't cost any thing I think everyone should have one to keep income from business seperate from personal income. Bette

    3 years ago

  • ByLisaHorlander

    Lisa Horlander from LisaRachelHorlander says:

    thank you thank you!!!

    3 years ago

  • WanderingCreekJewels

    Carol Hearn from WanderingCreekJewels says:

    I do not see any reason for a sole proprietor to have an EIN. Banks and suppliers are well aware that Schedule C filers (sole proprietors) do not generally have EINs. Since you do not need it to file your tax return, why clutter up your life with another number you don't need?

    3 years ago

  • fatepatterson

    Fate from Madebyfate says:

    Thanks for sharing :)

    3 years ago

  • UnexpectedTreasure

    UnexpectedTreasure from UnexpectedTreasure says:

    *Scratching my head in confusion* :)

    3 years ago

  • StudioNorthernLights

    Chuck Cooke from StudioNorthernLights says:

    I have two etsy shops and they are each separate businesses. I just learned at the IRS web site that as long as they are sole proprietorship's one uses the same EIN number.

    3 years ago

  • OLDITEMS

    Steven Jordan from BlueCrabsVintage says:

    In Reply to CourtyardCraftsGifts: You are exactly right, I to read the statue. Judging by some of these questions asked here, a lot of folks are going to make unnecessary headaches for themselves by screwing around with this.

    3 years ago

  • peggygroce

    peggy groce from peggygroce says:

    Hi I'm new to being a crafter who sells her crafts. I'm from Pa. do I also need to get a sales tax I.D. number and how much can you make before you need to submit sales tax to the state and how much can you make before you need to claim income on your tax return?

    3 years ago

  • CK1Art

    Keyvan Heydari from CK1Art says:

    OH gr8 ! thanks For share !

    3 years ago

  • taffycoco

    Stephanie B. says:

    what if you just make cash sales only...? I have never filed w/ the IRS on my business. it is more of a hobby..So when i may sell enough to make more items, am I liable to file taxes? Just curious! and if you do sell any items, are you required to pay taxes and what about paying yourself? then you have deductions to the SS, medicare, and so on! HELP!!!

    3 years ago

  • TheMillineryShop

    Marcia Lacher from TheMillineryShop says:

    OMG, this article has given me the willies.

    3 years ago

  • felicesereno

    Felice Sereno from FeliceSereno says:

    Actually, you can get an EIN even if you dont have employees - per my attorney - its not to disclose your social in case you need to give info to any buyers.

    3 years ago

  • felicesereno

    Felice Sereno from FeliceSereno says:

    i mean in order NOT to disclose your SSN, but give an EIN instead

    3 years ago

  • CourtyardCraftsGifts

    Cheryl Holland from CourtyardCraftsGifts says:

    Sorry, felicesereno, you have received incorrect info from your atty. Hire a CPA that UNDERSTANDS the law or look it up yourself on the IRS site. If you are a sole prop; do not get or use an EIN #. Defined an EIN is an EmployER ID number. Are you an employer? You do not need to ever disclose your SS # to your buyers. You DO NOT need, nor should you get an EIN UNLESS you have employees or the other circumstance I listed above in previous posts. I cannot express enough what a disservice this article has generated. I looked at the IRS website - the IRS is not LIMITING giving out EIN #'s since so many people are applying for an EIN that DO NOT NEED one! As a sole prop you use your SS# on your tax return - nothing else.

    3 years ago

  • CourtyardCraftsGifts

    Cheryl Holland from CourtyardCraftsGifts says:

    View this link to determine if you need an EIN! Note this is the IRS website; http://www.irs.gov/businesses/small/article/0,,id=97872,00.html

    3 years ago

  • BNounge

    BNounge says:

    Jason, I applied for an EIN in January. I haven't sold anything yet. If I don't sell anything by the end of the year will I still be obligated to pay something to the IRS because of my EIN? I was recently informed that a friend of mine had a tax ID and still had to hassle with the IRS and had to pay even though they didn't make any money.

    3 years ago

  • JJMFinance

    Jason Helping Your Etsy shop thrive from JJMFinance says: Featured

    A few clarifying points to address some of the comments above: - A EIN is one type of TIN (Taxpayer Identification Number). A SSN (Social Security Number) is another type of TIN. - Getting an EIN does not require you or force you to file any type of different taxes. It is simply a way for the IRS to identify your business. - For sole proprietors, no Etsy seller absolutely has to get an EIN - they can always just use their SSN. It is helpful for opening business bank accounts, provides you identity theft protection by not using your SSN, and is often required when filing for other licenses and business purposes. It is a lgocial step for a business to aquire an EIN. - Many sole proprietors have EIN's, even though they do not have any employees (not an employer). I encourage you to get your EIN today! Feel free to send me a convo to ask any specific tax related questions. Regards, Jason (JJMFinance)

    3 years ago

  • JJMFinance

    Jason Helping Your Etsy shop thrive from JJMFinance says:

    Here is some information about canceling/closing your EIN from the IRS (having and EIN that you never use): http://www.irs.gov/businesses/small/article/0,,id=177073,00.html The IRS can never force you to pay taxes on profits you do not have.

    3 years ago

  • daniellexo

    Danielle Maveal from daniellexo says:

    Thanks for clarifying Jason! You're amazing! It's true, if you’re a sole proprietor, you’re not obligated to get a Tax ID number, but it’s still commonly considered good practice. As always, consult your own accountant and small business advisor (Check out Score.org!) concerning your specific business needs!

    3 years ago

  • CourtyardCraftsGifts

    Cheryl Holland from CourtyardCraftsGifts says:

    I would like to state that sole proprietors should not believe getting an EIN is without consequences since it may well invite the IRS into your finances seeking unnecessary documentation, tax filings and paperwork - opening a hornets nest for no reason. An EIN number is to identify employers - it is a tax identification number for employers (and a few other entities like a corporation or LLC or legal partnership, etc.) . Employers defined is someone who has an or more than one employee. Meaning, you pay compensation to the employee and withhold the appropriate, Fed, State and perhaps local income taxes. If your are a LLC, Corp, Keogh plan holder, certain trusts, etc. you file as a business and use your EIN. IF your file income taxes as a sole prop you use your SS#. The IRS does not want sole props to have an EIN since sole prop are not employers. If you have an EIN, the IRS will assume you ARE an employer and be looking forward to your business tax return. The IRS won't be looking at your 1040 tax return filed under your SS#. You have told the IRS you are an employer, so the IRS expects you to file a business tax return along with w/holding tax payments as scheduled and required for your business. You do not need an EIN to open bank accounts, file individual tax returns or buy wholesale. You can either use your SS# or a TIN (Taxpayer Identification Number) that is issued to you under your personal name by your State agency. That TIN can be used when submitting your state sales taxes and can be used any place you may like to ID your business except on a business tax return. You may be exposed to greater risk and identity fraud by having both a SS# and an EIN since the more IDs you have attached to your name or business, the greater percentage risk of someone using one against you. Please visit the IRS website and read and understand the EIN procedures. Remember an EIN is an EmployER identification number. Here is a link to tell you whether or not you should have or apply for an EIN. If you ARE an employer you probably now now different tax forms are required of you as compared to a sole prop and certain payroll taxes are part of your financial necessities. Don't just take my advice, check for yourself at http://www.irs.gov/businesses/small/article/0,,id=97872,00.html

    3 years ago

  • artisanwoodcrafting

    artisanwoodcrafting from artisanwoodcrafting says:

    the IRS will see a business tax return. a schedule C is a business return, its for SP's/small business. you enter the EIN on it, so they will see a return attached to that EIN. they will also see that you have no employee deductions on that return, so they know you wont be filing any payroll tax info either

    3 years ago

  • artisanwoodcrafting

    artisanwoodcrafting from artisanwoodcrafting says:

    also, when you fill out the application, the instructions say-"if you wont have employees, then enter 0". so, they know from that you arent employing anyone, and wont be expecting payroll tax returns

    3 years ago

  • CourtyardCraftsGifts

    Cheryl Holland from CourtyardCraftsGifts says:

    artisanwoodcrafting - Nope; a schedule C is not a business return; it is a schedule (form) attached to a 1040 (US INDIVIDUAL Income Tax Return). Only sole proprietors (NO employees) or a LLC having no employees can/should file a Schedule C. Sch C is a Profit or Loss FROM Business for Sole Proprietors. Again, it is not filed separately - it is attached to an individual's tax return. SP must file a Sch C for each business they operate and ID the business by a code retrieved from the Federal govt lists of codes published each year. If you insert an EIN (the Sch C says "if any") it can trigger the IRS to look for a business tax return. No where on the Sch C does it ask the number of employees. An application for an EIN may ask for the # of employees since the person applying is notifying the IRS of the intent to have employees either at the time of application or in the future. I imagine a Sch C is something the IRS probably highly scrutinizes. Whether or not you have a profit or loss from your SP buz, a Sch C is filled out regardless. Once you have an EIN it is perpetual; (never goes away), and cannot be re-assigned to another SP. The IRS will match up an EIN to a business tax return not a 1040 (which is an individual tax return). Corporations, LLC (with employees), legal partnerships, trusts, those with Keogh plans, charitable orgs, etc., file a Business Tax Return as well as w/hold taxes from employees and submit payroll tax reports and a host of other forms. I really wish and strongly encourage my fellow Etsy sole props to refer to the IRS website to understand the EIN and YOUR business requirements. Trust me, I'm trying to help and have not steered you wrongly! Here's a great video lesson on getting your small business tax questions answered: from the IRS website http://www.irsvideos.gov/virtualworkshop/

    3 years ago

  • HoneyBeeHolistics

    Melissa from HoneyBeeHolistics says:

    Getting an EIN & business license in your state opens up so many doors!! It is worth taking the plunge & making it official!

    3 years ago

  • artisanwoodcrafting

    artisanwoodcrafting from artisanwoodcrafting says:

    I spoke with the EIN dept at the IRS. they said it is quite common for SP's with no e3mployees to get it nowadays, so you dont have to give out your SSN, like on 1099's you may issue, or to companies like paypal. they said an EIN is not exclusively for employers, its for any business who wants a TIN that is not their SSN. when you fill out the application and enter 0 employees, they said they then know you arent an employer and wont be expecting any employer related tax returns from you. its a common misconception that an EIN is only for employers, but its not true at all. there are actually a few situations where it is required to get one, even when you dont have employees

    3 years ago

  • artisanwoodcrafting

    artisanwoodcrafting from artisanwoodcrafting says:

    an an above post is totally incorrect- if you are a SP with employees, you would still file a schedule C for your business. and they would then match up your employer returns with your schedule C, in pub. 334 from the IRS, it even says you deduct employees pay on schedule C

    3 years ago

  • swallownest

    Candace Hennekens from swallownest says:

    Very helpful. I know I should have an EIN for privacy reasons with SSN so this was the kick in the pants I needed to go apply and be done with it!

    3 years ago

  • MCMdesignSTORE

    MCMdesignSTORE from MCMdesignSTORE says:

    Another advantage when you have an EIN. You do not have to pay a sales tax when you are buying inventory.

    3 years ago

  • imtushay

    Steve Ryan from eTreats says:

    An excellent article for helping a newbie like me. Thanks.

    3 years ago

  • Outlandred

    Lisa Norton aka Boo Boo or Red from LaFLeurDeLisDragon says:

    What if i use my etsy as a hobby? How do i show that on my income taxes?

    3 years ago

  • redundancy

    Julie Barfield from GloryHounds says:

    Thanks for all the great info--I'm learning a lot! I am starting from the very beginning and need to know which NAICS code I'm supposed to use. I design and create jewelry to sell online and at craft fairs. Do you know which one(s) I should use?

    3 years ago

  • NLMDecor

    Neda Moyer says:

    This is great information. Does anyone know if a business lic. is required? or a good idea?

    3 years ago

  • Diane64

    Diane64 from Diane64 says:

    I've had a sole proprietor business in the past. I had a booth at a local antique mart. I never made a profit, but the aggravation of filing my joint tax return with the extra form and keeping inventory made for such a hassle. I had to file both State and Federal. My tax number was provided from the State. My little business was more of a hobby; I'd love to say it was profitable, but alas my overhead was too great (rent, stock, etc.). The State wants tax money 4 X a year. So forms have to be filled out, etc. What a spoiler. I really wonder also, who knows of anyone who shares their garage sale proceeds with the gov???? I don't think all states make that mandatory. So far I've not run into the Garage Sale police. I was hoping Etsy would be simpler, but now I'm thinking E-bay.....

    3 years ago

  • robosborne

    Rob Osborne from RobOsborne says:

    I have an EIN now. Look out, world!

    2 years ago

  • robynpowell1983

    Robyn Powell from RedRobynLane says:

    I'm sooo confused by all this!!! If I get an EIN will I be required to pay full federal taxes on my business? I was told that getting a TIN only requires you to pay taxes on the items you sell IN YOUR STATE. I mean how often is the irs looking into every seller on ETSY ? I would REALLY benefit from no-tax inventory and wholesale pricing but I'm wondering if an EIN is the right way to go? Doesn't that open doors for "investigations" into making sure every state license, state tax, etc.. is filed and by the time it's all over, all your profit is eaten by taxes! Just not sure what to do....

    2 years ago

  • ESArt

    Kate Sumners from ESArt says:

    Quick and easy, done and done!

    2 years ago

  • sassyswirls

    Teresa Johnson from SassySwirls says:

    Just getting started with Etsy. In the past I had a cupcake business (home based), was sole proprietor, had an LLC and EIN number as well as business insurance, filed taxes every year.. Do I need all these things when selling handmade earrings, headbands w/flowers, etc. for babies and adults, baby earrings and bracelets, crocheted yarn necklaces?. May add other things. Never paid taxes quarterly b/c I understood that unless cupcakes were eaten on my premises (which they weren't) I didn't have to tax. Have given up cupcake business after 3 years-want to do something different.

    2 years ago

  • theladydontmind

    Amanda Bourgoine from tailcoatpetals says:

    I have an EIN and my old employer removed the company I was supposed to work for but never did. I need to use my EIN to register my Etsy store but am not sure how to do it. Help!

    2 years ago

  • kimr0519

    Kim Reardon from kimr0519 says:

    I'm still confused. You don't HAVE to get an EIN, but you should. Or you shouldn't because you're a SP. My question is: do I need to file taxes at all on the whole $30 profit through my Etsy? I consider it my business, however I do not make enough for it to really make a difference. I estimate MAYBE $100 in profits by the end of the year. Should I apply for an EIN, state sales tax, etc?

    2 years ago

  • xoticenigma

    xoticenigma says:

    Really enjoyed this very informative article and comments as well! Will convo you regarding some questions about starting up an online-business possibly on Etsy. Great job Jason!!!

    2 years ago

  • danielcabral81

    Daniel Cabral says:

    Jason - Is there any advantage to getting a coporation or LLC EIN? Thanks!

    2 years ago

  • lorenamarmolejo

    Lorena and Elodia from LollipopAprons says:

    Thank you so much for this information. I have not read all comments so not sure if this is a repetitive question, however, I'd like to know what your opinion is on obtaining an EIN using your personal name or using a business name. I plan to open more than 1 Etsy shop so I would like to know your expertise on applying for 1 EIN per shop or just use my name for all?

    2 years ago

  • elizabethperrett

    Elizabeth Perrett from LizsPartyDesigns says:

    So...I was contacted by Etsy about me reaching the " tax law" requirement of almost 200 sales. I am required to submit my SS# or EIN # I am at 150 sales almost and want to definately continue selling online. However I'm nervous! I am married and we have 1 dependent, Will this hurt me at the end of the year filing taxes or benefit me? Will we owe? or get refunded? Or....should I file seperately on my business part? HELP!

    1 year ago

  • cidcruder

    cid cruder says:

    I was sighing up for my EIN online, and I got my number and printed out the copy ,but when I click the finish button it stated that I ran out of my 15 minute time limit...do I have to start over , or is my number valid?

    1 year ago

  • bedazzledfootjewels

    Be-Dazzled Foot Jewels from BeDazzledShop says:

    We're trying to get an EIN, but so far we can't get through on the phone. Can I just ask - Does it cost to get an EIN? I went on line to get one and the cost was $197 so I backed out. I read on Etsy that it didn't cost anything, but maybe that was a long time ago. Please help!!! Mary & Nancy of Be-Dazzled

    1 year ago

  • bedazzledfootjewels

    Be-Dazzled Foot Jewels from BeDazzledShop says:

    Just got an EIN, then we had to get a business license and yesterday I received a call from the property tax office saying we have to pay tax on our property for having a small business run out of our home. Is this right? I already pay property tax. Now do we have to charge tax on our merchandise? I'm so confused. They also said we had to file??? I'm almost ready to call it quits, this seems too much for such a small etsy shop. I would appreciate any help you could give.

    1 year ago

  • AuriesDesigns

    AuriesDesigns from AuriesDesigns says:

    We just applied for ours today. Thanks!

    1 year ago

  • bethrem

    bethrem says:

    I have began tinkering around making stuff...mostly giving away. I found some items I want to try but I need a tax id number. So if I were to get a tax id number would I have some form of tax filing at the end of the year when no revenue is made?

    1 year ago

  • HappenchanceLife says:

    Hi Jason, I will be opening my Etsy shop soon. I am wondering if I have to register my company name at a state or federal level before I apply for an EIN?

    1 year ago

  • chantalmarieliving

    Chantal from chantalmarieliving says:

    I know this is an old thread and may not be read. If I change from a S corp. to a sole proprietor, I believe that I need to apply for a new EIN with the IRS. However, will Etsy let me keep my shop name? Thank you.

    286 days ago