A hair salon is a unique type of business. As a hair salon owner, most of your “employees” are likely to be contractors renting space directly from you. With that in mind, do you need an “Employer Identification Number”? The answer is yes: Not only do you need one, but it’s also not that hard to get. Here’s how you can get started with an online EIN application today.
Steps to Get a Tax ID (EIN) Number for a Hair Salon Business
- Prepare Owner Information
- Apply for a Tax ID (EIN) Number for a Hair Salon Business Online
- Apply for a Tax ID (EIN) Number for a Hair Salon Business via Mail or Fax
- Why Do I Need a Tax ID (EIN) Number for a Hair Salon Business?
- How Do I Get a Tax ID (EIN) Number for a Hair Salon Business?
- Is a Tax ID Number the Same as an EIN Number?
Begin by collecting all the relevant information regarding your business. If you have your company’s formation documents, that’s best. Forming a company doesn’t automatically get you a Federal Tax ID Number (FTIN), also known as an Employer Identification Number (EIN). It just forms the legal structure of the company itself. You still need to apply for an EIN separately.
To apply for an EIN, you will need to know basic information about the company, as well as the company’s owner, a partner with the company, or a registered agent for the company. When applying for an EIN, you will need to select someone to act as your representative. This is usually the company owner, but it doesn’t have to be.
Luckily, you don’t need to furnish a lot of information about the representative – their full name, address, and SSN or ITIN will be enough. The representative will be contacted if there are any questions regarding the EIN application.
Whether you need to get a business lease, acquire a business loan or just hire an employee, you may need an EIN number fast. The fastest way to get an EIN number for a hair business is through an online application. A tax ID service can collect your documents and help you fill out your application. Then, you’ll just need to wait about an hour for your tax ID to be processed.
To acquire a tax ID number online, you will need:
- Your business information
- Your owner information
- Your reason for applying for a tax ID number
The application process for an EIN number is simple and fast, but it is possible for an application to be rejected if it isn’t filled out properly. A tax ID service can save you from having to figure out why your application was rejected.
The same application that is sent online can also be sent via mail or fax, once printed. Effectively, the application will be the same: It will need the same information outlined above. The major difference is speed.
If you apply for a tax ID number via mail, you will need to wait four to six weeks for it to be returned. If there are any issues with your application, you may need to restart the process and submit your application again.
If you apply for a tax ID number via fax, you will need to wait three to five business days for it to be returned. If there are any issues in the fax transmittal, you may not be aware of them as fax technology can be a little erratic and fickle. You will need to have access to a fax machine to receive any error messages or direct replies.
Since the application is usually still acquired online, there’s really no reason to send it by mail or fax: It’s easier to send it in digitally. Both mail and fax will take longer, and there’s no advantage to having your forms processed this way.
Many hair salons keep their staff as “contractors” rather than “employees.” But this may not always be correct. Many salon staff members should be rightfully paid as employees, and to pay someone as an employee, you need an Employer Identification Number. If you need to hire even a single staff member, you need an EIN.
For a salon, an EIN will likely come in handy foremost for equipment and wholesale items. To get an equipment loan for the equipment that your salon needs, a tax ID number will be necessary. A Business Tax ID (EIN) is used by banks and creditors to track your company’s identity and its credit rating. EINs are also required by wholesale companies, such as salon supply stores.
EINs are also used to open business bank accounts, acquire business leases, get licenses and permits for the business, and procure credit cards and credit lines for the business. Any time your business needs to pay federal taxes or payroll taxes, it’s your EIN that will be used to identify your business. Your company may be incorporated, but it has no single, distinguishing ID number until you apply for one.
To get a tax ID, also known as an EIN number, you first need to collect information about the business and the business owner (or a partner or representative). You can then apply for a tax ID number online through a tax ID service. If you apply online, you should receive an EIN in an hour. Your EIN will be active and can be used right away.
An EIN (Employer Identification Number) refers to a nine-digit number assigned by the U.S. government to identify your business, just as a Social Security number identifies an individual. When used for payroll taxes and employment forms, this number will be called an EIN. However, when used to pay federal taxes, this number will be called a Federal Tax ID Number (FTIN). These numbers refer to the same thing, just in different contexts.
A salon should acquire an EIN number as early as possible, as it will be necessary to secure a business lease and a loan for any business-related equipment. A tax ID service can help.