- The EIN is needed to file federal, state and sometimes local taxes. Having an EIN does not exempt the holder from paying state or local taxes. EIN holders must apply for state or local licenses and permits as required by local and state regulations. Not all states have sales taxes or income tax. Check with your state and local tax offices for regulations.
- Most businesses pay some types of state taxes. However, nonprofit businesses or charities are often exempt from paying certain taxes.
- According to the IRS, certain businesses, such as churches and religious organizations, generally do not have to apply for tax-exempt status. Other businesses obtain tax exemption by applying for status as a non-profit company. To qualify for for tax-exempt status, a business entity needs an EIN.
previous post
next post