SMLCC: effect of notice 99-6 being obsolete?

responsible for collecting, reporting and paying over employment tax obligations using the name and EIN assigned to the LLC."

you don't have to have an EIN--what tends to happen in situations like yours is, after the application, you get a letter from the IRS "wondering" why you haven't been filing 940/941's. I agree it's not written very well; bottom line--don't apply for an EIN if you don't need one. And if you do, make sure you check the correct box on the application as to why you need one. You also have to be careful, as a sole proprietor, when sending in estimated payments--I had a client who wrote his EIN (instead of his SSN) on an estimated payment and it created a real mess.

responsible for collecting, reporting and paying over employment tax obligations using the name and EIN assigned to the LLC."

I'm not sure where you are coming from on this. A single member LLC (SMLLC) that is not a corporation is a sole proprietorship (SP). An SP without employees does not require an EIN and does not collect employment taxes. An SP with employees, requires an EIN and is required to collect & remit employment taxes. An SMLLC with employees must also have an EIN. Prior to 2009, an SMLLC that was an SP and had employees could remit employment taxes using either the LLC name & EIN or the sole proprietors EIN and name. Alas, this is no more. The SMLLC with employees must now use the LLC name & EIN to remit employment taxes. The owner is still responsible for collection and remittance.

I'd change that to "a sole proprietorship without employees doesn't necessarily require an EIN", as there are other triggers for requiring an EIN, such as establishing a qualified plan.

It's also not totally clear to me you can form an LLC (at least in California) without obtainin an EIN. If the CA-SMLLC just uses the individual's SSN, this clouds the distinction between assets of the LLC and personal assets that are shielded from liability. It would seem to me problematical to do it this way.

Here is what California has to say:

Employer Identification Number (EIN) - Do I Need One?

Though it's commonly called an employer Identification Number (EIN), there are times when you may need an EIN even though you do not have employees. An EIN can be used to identify a business entity that is legally separate from yourself, such as your corporation, partnership or retirement plan. Generally, businesses need an EIN. One exception is a sole proprietor with no employees. However, sole proprietors who must pay federal excise or payroll taxes will need an EIN, too. (From

I agree that there are other reasons why an SP without employees might require an EIN.

I don't agree that CA requires an EIN for an SMLLC operating as an SP. Last time I looked, CA conformed to the federal rules on EINs. An SMLLC acting as a sole proprietor would only require an EIN using the rules already discussed (employees, qualified plan, etc.). These are the federal rules found at:

Thanks for the information, this is interesting.

I am still not comfortable with it. For one thing, an individual can run more than one small business using their SSN. But if one of them is an LLC, how does one determine which assets are shielded? The individual can assert "this account receivable is not for the LLC you have a judgment against, therefore you can't attach it", but it sure would be cleaner if it's under a different taxpayer ID.

But maybe these are edge cases.

Steve

I think the way to differentiate is to have the LLC assets clearly titled in the LLC name. Real Property, Personal Property, bank accounts, etc. This is the case for LLCs, corporations (C and S), and regardless of any consideration of TINs.

And why do you think this is an issue with CA SMLLCs and not those of other states? Or did I misread your earlier post?

That makes sense.

I am speaking in complete ignorance of other states, and only partial ignorance of California rules. :-)

Steve