topic Re: Benefits of an EIN for a sole proprietor? in Business Credit

Benefits of an EIN for a sole proprietor?

Mshellt — Fri, 15 Aug 2014 06:10:00 GMT

What are the benefits of having an EIN when you are a sole proprietor with a fairly simple business with no employees? Is it a good idea to register an EIN and work on building up a business credit score in the same way one builds up a personal credit score?

Re: Benefits of an EIN for a sole proprietor?

red259 — Fri, 15 Aug 2014 20:53:51 GMT

@Mshellt wrote:
What are the benefits of having an EIN when you are a sole proprietor with a fairly simple business with no employees? Is it a good idea to register an EIN and work on building up a business credit score in the same way one builds up a personal credit score?

If your an independent contractor you may not want to be giving out your social all over the place, so getting an EIN helps with that. I'm not really sure having an EIN will help building up business credit. I'm a sole prop and have business cards. My understanding is that a business profile was created by me getting those cards. Either way credit card companies will want a personal guarantee on new credit cards and will run your personal credit.

Re: Benefits of an EIN for a sole proprietor?

CreditUnionFan — Sat, 16 Aug 2014 11:46:54 GMT

@Mshellt wrote:
What are the benefits of having an EIN when you are a sole proprietor with a fairly simple business with no employees? Is it a good idea to register an EIN and work on building up a business credit score in the same way one builds up a personal credit score?

As the other poster mentioned, as a sole proprietor, they will still want your SSN in most cases, but the credit does get opened with the EIN.

I remember I was operating as a business for a while; it wasn't until I attempted to open a business account with T-Mobile that they required the EIN. Applying for the EIN can be done over the Internet in probably 15 minutes at most.