If you’re changing from a sole proprietor to an LLC, you need a new EIN only in specific situations: your LLC has more than one member, it has employees or owes excise taxes, or you elect to have it taxed as a corporation or S corporation. A single-member LLC with none of those features can keep using your Social Security Number or the EIN you already had as a sole proprietor. The IRS treats that kind of LLC as a “disregarded entity” for income tax, meaning it isn’t a separate taxpayer from you.1Internal Revenue Service. When to Get a New EIN
The Three Situations That Require a New EIN
The IRS requires a new EIN whenever the conversion produces what it considers a separate tax entity. For a sole proprietor forming an LLC, that happens in three cases.
- The LLC has more than one member. A multi-member LLC is taxed as a partnership by default, which is a different entity type from a sole proprietorship. A new EIN is required.
- A single-member LLC has employees or owes excise taxes. Even though a single-member LLC is normally a disregarded entity for income tax, it is treated as a separate entity for employment and excise taxes. One employee, or any excise tax obligation, means a new EIN.1Internal Revenue Service. When to Get a New EIN
- You elect corporate or S-corporation tax treatment. Filing Form 8832 to be taxed as a corporation, or Form 2553 to be taxed as an S corporation, changes your classification enough that the IRS treats the LLC as a new entity. A new EIN is required.1Internal Revenue Service. When to Get a New EIN
You cannot transfer your sole proprietorship’s EIN to the LLC in any of these cases. The old number stays with the old entity. Using it on filings for the LLC will cause processing errors and can trigger information return penalties, which for 2026 run from $60 to $340 per incorrect return depending on how late the correction is made.2Internal Revenue Service. Information Return Penalties
When You Can Keep Your SSN or Existing EIN
If you’re the only member, you don’t elect corporate taxation, you have no employees, and you don’t owe excise taxes, the IRS lets you keep using your Social Security Number or your existing sole proprietor EIN for federal tax purposes.1Internal Revenue Service. When to Get a New EIN The LLC’s income and expenses go on Schedule C of your personal return, just as they did when you were a sole proprietor.3Internal Revenue Service. Limited Liability Company (LLC)
The wrinkle is that the IRS doesn’t require an EIN in this situation, but your bank probably will. Many banks require a separate EIN to open an account in an LLC’s name, even for a single-member disregarded entity. Some states also require a federal EIN for state tax registration. The IRS allows you to obtain an EIN voluntarily in either case.4Internal Revenue Service. Single Member Limited Liability Companies
Getting an EIN even when it isn’t federally required is usually a practical move. It keeps your Social Security Number off W-9 forms and invoices you send to clients, which reduces your exposure to identity theft. If you later hire an employee, you’ll already have the number you need.
How Your Tax Election Changes the Answer
An LLC’s default tax classification depends on how many members it has. A single-member LLC is taxed as a sole proprietorship (disregarded entity), and a multi-member LLC is taxed as a partnership.3Internal Revenue Service. Limited Liability Company (LLC) Accepting the default requires no additional forms.
If you want the LLC taxed as a corporation, you file Form 8832. The election can take effect no more than 75 days before you file the form and no more than 12 months after.5Internal Revenue Service. Form 8832 (Rev. December 2013) To elect S-corporation treatment, you file Form 2553 no more than two months and 15 days after the start of the tax year the election is to cover, which is March 15 for a calendar-year LLC.
Either election triggers a new EIN for a single-member LLC that was operating under your SSN. The classification change is significant enough that the IRS treats the LLC as a new entity.1Internal Revenue Service. When to Get a New EIN
How to Apply for the New EIN
Form your LLC with the state before you apply. The IRS warns that applying for an EIN before the entity legally exists can delay your application.6Internal Revenue Service. Get an Employer Identification Number
Form SS-4 asks for the LLC’s legal name as registered with the state, any DBA or trade name, the physical and mailing addresses, the name and SSN or ITIN of the responsible party, the number of members, and the closing month of your fiscal year (December for most small businesses).
The IRS online application is the fastest route and issues the EIN immediately at the end of the session. You’re limited to one EIN per responsible party per day, and the online session doesn’t save progress, so have everything gathered before you begin.6Internal Revenue Service. Get an Employer Identification Number If you’d rather use paper, faxed Form SS-4 applications are processed in about four business days and mailed applications take roughly four weeks.7Internal Revenue Service. Instructions for Form SS-4 (12/2025)
What to Update Once You Have the New Number
The EIN itself is just a number. Making the LLC operate as a genuinely separate entity is what protects the liability shield you formed it to get. Courts look at whether personal and business finances stayed separate when deciding whether to hold an owner personally liable for business debts.
Open a Business Bank Account in the LLC’s Name
Open the account in the LLC’s legal name using the new EIN. Don’t continue depositing business income into a personal account or an account still under the sole proprietorship name. Mixing funds is one of the fastest ways to lose the liability protection.
Send New W-9s to Clients and Vendors
Every client and vendor who pays you needs a new Form W-9 showing the LLC’s legal name and new EIN, so future 1099s and payments are reported under the correct entity.8Internal Revenue Service. Form W-9 (Rev. March 2024) A 1099 issued to your old sole proprietorship name and SSN after the conversion won’t match what you report on the LLC’s return, which can generate IRS notices.
Transfer Titled Assets
Vehicles, titled equipment, and real property owned by the sole proprietorship need to be formally moved into the LLC’s name. Vehicles usually require a title transfer through your state’s motor vehicle agency; real estate requires a new deed. If an asset has a lien or mortgage, get written permission from the lender before transferring, because the lender will want to evaluate the LLC’s creditworthiness.
Update Licenses, Permits, and Insurance
Contact state and local licensing agencies to update business licenses and permits with the LLC’s name and EIN. Some jurisdictions treat a change in business structure as a new license application, with fees and fresh paperwork. Update your business insurance too. A policy issued to you as a sole proprietor may not cover claims made against the LLC.
Handle Payroll Under the New EIN
If you had employees under the sole proprietorship, employment tax filings (Forms 941 or 944 for income and FICA withholding, Form 940 for federal unemployment) go under the new EIN starting from the conversion. Employees should complete new W-4s for the LLC’s records.9Internal Revenue Service. Form W-4 Employee’s Withholding Certificate 2026 At year-end, you may need to issue two W-2s per employee: one under the old sole proprietorship EIN for wages paid before the conversion, and one under the new LLC EIN for wages paid after.
Closing the Old Sole Proprietorship EIN
If your sole proprietorship had its own EIN, close that account with the IRS once you’ve filed all final returns and paid any balances due. Send a letter that includes the business’s full legal name, the EIN, the business address, and the reason you’re closing the account. If you kept the notice the IRS sent when it first assigned the EIN, include a copy. Mail everything to:10Internal Revenue Service. Closing a Business
Internal Revenue Service
Cincinnati, OH 45999
The IRS won’t close the account until all required returns are filed and balances are settled. An EIN is permanent once assigned, so closing the account doesn’t erase the number. It tells the IRS not to expect any more filings under it. Leaving the old account open isn’t illegal, but it can cause confusion if forms with that EIN show up at the IRS after you’ve stopped using it.