What is the responsible party?
According to the IRS, the responsible party is an individual who directs and controls the entity associated with the EIN. This person signs documents on behalf of the company and represents it to the IRS. The responsible party must be a natural person, not an entity.
All correspondence, both physical and digital, is sent to the Responsible Party listed on the EIN form. In an LLC, the responsible party must be one of the members for tax purposes. Therefore, in a Single-Member LLC, the responsible party is the sole member.
For more details, please visit the IRS website.
Can I change the responsible party later on?
Yes, you can change the responsible party for your company. Here are the steps to follow:
If your EIN has already been assigned or is in progress, notify the IRS of the change using Form 8822-B or include the update in your annual tax filings. Detailed instructions are available on the IRS website.
Additionally, update your company’s post-formation documents to reflect this change.
Do you have any other questions?
Understanding the responsible party is crucial for managing your business’s compliance with IRS regulations. This individual directs and controls the entity associated with the EIN, signs documents, and represents the business in all IRS communications. In an LLC, the responsible party must be one of the members for tax purposes.
If you need to change the responsible party, you can do so by submitting Form 8822-B to the IRS or including the update in your annual tax filings. Additionally, it’s important to update your company’s post-formation documents to reflect this change and ensure consistency across all records.
For more details, check out the Startxpress Help Center and Blog. If you need assistance, contact support@startxpress.io! We’re here to help make managing your business as smooth as possible.
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