Interested in getting your tax ID number? Depending on your type of business, you may not have much of a choice. Many organizational structures, including limited liability companies (LLCs), corporations, and partnerships must have a tax ID number to operate legally in Colorado. In this guide, you’ll learn why tax ID numbers are important, how to obtain one, and how to make sure you get yours as quickly as possible in Colorado.
Steps to Obtaining Your Tax ID (EIN) Number in Colorado:
- Tax ID Application Required Information
- Get a Tax ID Online for Your Colorado Business
- Get a Tax ID by Phone, Mail or Fax for Your Colorado Business
- Do All Businesses Need a Tax ID Number or EIN?
- Tax ID Number Application for Small Business Owners
- Colorado State Tax ID: What It Is and How to Get One
To get a tax ID number, you’ll need to fill out a questionnaire, answering several questions about your business and its founding members; this is a requirement no matter which application method you choose. Fortunately, you won’t need to have much information to complete this part of the process.
You’ll need to provide the full legal names and legal addresses of all your business’s founding members. This includes you and any partners you may have. You’ll also need to gather their social security numbers (SSNs). If you have this information in hand, you’ll be able to complete the tax ID number application much faster.
There are several ways you can access the tax ID number application, but some are inherently better than others. Traditional methods tend to be sluggish and inconvenient, especially when compared to the perks offered by the online application. For all entrepreneurs, the online application is inherently better, and for several reasons.
For starters, the online application is more convenient. You won’t need to track down a paper application, nor will you need to wait for designated hours. Instead, you can access the online application at any time of day, so long as you have an internet-connected device. If you’ve gathered all the required information in advance, it should only take you 5 minutes to finish the application.
After you’ve submitted it, the online application will return your tax ID in record time. In fact, most people receive their tax ID by email in an hour or less. Compared to the 4 to 6 weeks it takes to get a tax ID when you use a traditional application method, this is ridiculously quick.
Online applications are much faster and more convenient, but you can also use a traditional application method to get your tax ID number. For example, you could apply over the phone. To do this, you’ll need to contact a live representative during designated hours, and answer the appropriate questions about your business over the phone. You could also fill out a paper application, and mail it or fax it in. The big problem with these approaches is their turnaround time. You can expect to wait 4 to 6 weeks to get your tax ID by mail.
Do all Colorado businesses need to have a tax ID number?
The short answer to this question is "no," but the majority of businesses will need to have one. Here, "tax ID" refers to your federal tax ID number, which is also sometimes called an employer identification number, or EIN. This is a 9-digit number uniquely assigned to your business when you register with the federal government, and it’s required for a variety of purposes.
For example, you’ll need to have an EIN if your business has multiple partners, like if it’s a partnership, a corporation, or an LLC with multiple members. You’ll also need one if you’re going to hire any employees. These criteria alone make the majority of businesses need an EIN. You’ll also need one to open a business bank account, and for most financial applications, like if you want to get a business line of credit or a loan. And you’ll definitely need it if you’re going to apply for a business license or permit.
Small business owners looking to get a tax ID number might wonder which method is best for securing a tax ID. The ideal method would be one that’s simple and easy to understand, but also fast, so you can get your tax ID and keep your small business running.
No matter what, you’ll need to fill out an application, answering basic questions about your business and its founding members. However, one method stands above the others in both speed and convenience: applying online.
Small business owners can apply online, using any device with an internet connection to access the intuitive form. If you have all the necessary information, small business owners can complete the form in just 5 minutes. After that, they’ll receive their tax ID number via email, typically in less than an hour.
Most states issue some kind of state-level tax ID number. This number is similar to but distinct from your federal tax ID number. Your Colorado state tax ID functions at the state level, while your EIN functions at the federal level. You’ll need a Colorado state tax ID for your Colorado business if you’re going to hire employees in the state of Colorado, or if you’re going to sell taxable goods or services in the state. You’ll also need one if you’re going to owe excise taxes, which apply to regulated goods like alcohol and tobacco.
Getting a Colorado state tax ID number is relatively easy. First, you’ll need to have a federal tax ID number in place; if you use the online application, you can get yours in less than an hour. Then, you can apply for your state tax ID using one of several available methods. Again, the online application is ideal. Filling out the online Colorado state tax ID number application won’t take long, and when you’re finished, you should get your state tax ID in 4 to 6 weeks.