What does this mean?
An EIN is your “Employer Identification Number.” It’s how the IRS identifies your company. What “failure to get one” means is obvious, but filling it out incorrectly means if you elect the wrong tax status on the form.
Does this apply to me?
Probably. While having employees, partners, or being a corporation would make you need one, banks want it even if you’re a sole proprietor -- so almost always, “yes,” it’ll apply to you.
How can this mistake be hurting my business?
Without an EIN, it could result in tax filing problems and penalties and interest on your tax obligation.
You could avoid this by:
Getting an EIN. It takes 5 minutes and you can get it free on the IRS website. Here’s the link.
Will set up his LLC, Salesly, but never got an EIN. WIthout the EIN, he wasn’t able to open a bank account. The bank attendant told him it took less than 5 minutes to do. Will went home and went to the IRS website and was able to get his EIN in less than 5 minutes, which he needed for the bank account and when his clients sent him W-9s because the clients had paid him money.