StudentDC Interactive

No matter what business legal form you choose, you will probably need an employer ID number.  One new DC found that the bank required her to have it before they would open an account.

I just walked someone through the process of getting her EIN (Employer ID) or “tax id” - online through the IRS website.  It’s easy.  Here’s how to do it:

1.  Go to the IRS website and on the left you’ll see a link to Form SS-4.  Download the page and print it out.

2.  Go through the form filling out all the information.  The NAICS code for chiropractors is 621310.

3.  You won’t find a box for “Limited Liability Company.”  If you are forming an LLC, you are either a single-member LLC - taxed as a sole proprietorship or a multi-member LLC - taxed as a partnership.

4.  Completing the form before you go online helps you get through the online questions more quickly and you won’t have to stop and make a decision or look something up.

5.  The online form is at the bottom of this link page: http://www.irs.gov/businesses/small/article/0,,id=102767,00.html

6.  Carefully go through the questions, answering each one completely.

7.  At the end of the process, you will have an opportunity to cancel.  Once you hit the “submit” button, it will be a minute or so and you’ll receive your EIN.

See what I mean? If you have questions, comment here or email me directly at jean@dcpracticesuccess.com.  I’m always happy to help.

There are some changes coming for limited liability companies.  Two states (Iowa and Idaho) have already adopted these changes, and in the coming months more states may also follow suit.

The changes affect both the filing documents and the operating documents.

Formerly, you filed “Articles of Organization” for your LLC with the state.  Now, in Iowa and Idaho, you must file a “Certificate of Organization.”  The filing process is the same, it’s just the document that’s a little bit different.

After your LLC has been approved, you should prepare an Operating Agreement.  Even if you setting up as a single-member LLC, you still need to have this document.  And with the changes, it becomes very important to have an agreement for multi-member LLCs.  Among the changes is a “one person-one vote” rule which states that, unless the Operating Agreement says otherwise, each member of the LLC gets one vote.  So a member with a 10% share of the membership gets the same number of votes as a member with a 90% share of the membership.  To prevent this “minority rule,” you can specifically state in your Operating Agreement how members will vote (according to percentage, for example).

There are some other similar changes to distributions.  I’ll keep you advised if I hear of other states that are making changes.

Before you set up an LLC in either Iowa or Idaho, check on the state secretary of state’s website or talk with an attorney.

By the way, in some states (like Nebraska), you can file for an LLC online.