If I create a trust to own my LLC, does it need its own EIN number?
Good afternoon, if I create a trust do I have to go on IRS and get a Trust Number instead of using the EIN number after the trust has ownership of the LLC?
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With a trust, it would require its own EIN. This is because each would have its own tax liability as a separate entity.
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Good afternoon, if I create a trust do I have to go on IRS and get a Trust Number instead of using the EIN number after the trust has ownership of the LLC?
Lexi, Chatbot
Good afternoon! Have you already created the trust in question?
I’m in the process.
Lexi, Chatbot
Are you looking to transfer ownership of an LLC to this trust?
Yes I am.
Lexi, Chatbot
Is there anything else the Lawyer should know before I connect you? Rest assured they’ll be able to help with trust creation.
No, that's all.
Elizabeth
Hi there! My name is Liz and I’ve been an attorney for more than a decade, and I am here to assist with your legal concerns.
So I can best help, does the trust have its own EIN or does the LLC only have an EIN?
Hey, the LLC only has an EIN.
Elizabeth
With a trust, it would require its own EIN. This is because each would have its own tax liability as a separate entity.
Is it possible to be both? I want my trust to own 100% of my LLC and I just want to manage it.
Elizabeth
You can indeed be both, it just has to be clear in the trust document. The trust can also then own the LLC.
After I get the EIN I can then go to the bank to open up an account, correct? I believe they ask for my social but I don’t want any connections.
Elizabeth
That's correct, the EIN will function much in the same way as your social does, but it would be the number for the trust.
And I can throw away the one I have now right?
Or will I need to use it for anything?
Elizabeth
The one for your LLC is still your LLC's EIN. If you need to file for the LLC, you would use it. With the LLC and trust, they would be treated like their own people. So the LLC needs its own number and the trust its own. This then creates the 2 layers between the entities because they are each using their own information.
Ahh I got it. Thank you so much for your help.
Is there a specific way to type up the trust document? Or no?
Elizabeth
You're very welcome. Also, eForms does have trust templates or you could have a lawyer draft the trust. I hope I was able to provide some clarity to your questions. Have a wonderful day.
One more question—
Once the trust is established I have to edit my operating agreement, correct?
In what part do I put that the trust owns 100% of the LLC?
Elizabeth
The trust agreement would state it owns the LLC, and then in the operating agreement under “Members,” the trust would be the 100% ownership member.
You're the bomb Elizabeth, thank you. Have a beautiful rest of your day.
Elizabeth
You too!
Elizabeth
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