Business Xpress Startup Toolkit Step 3 - Tax Numbers

Summary

The Oregon Secretary of State Corporation Division's video series guides entrepreneurs through the business startup process, emphasizing the importance of obtaining tax ID numbers. It explains how to acquire a federal EIN from the IRS, which is essential for opening a business bank account, and a BIN for Oregon payroll tax, necessary for businesses with employees or corporations. The video also advises on local tax ID requirements and the importance of consulting professionals for tax-related queries.

Takeaways

• 📚 The video series is a guide for starting a business in Oregon, complementing the Business Xpress Startup Toolkit.
• 🔢 The third step in the business startup process is obtaining tax ID numbers.
• 🇺🇸 Businesses in Oregon might need a federal tax ID number, known as an Employer Identification Number (EIN).
• 💻 An EIN can be obtained for free from the IRS website by following the 'apply for an EIN' links or search.
• ⏱ The online application process for an EIN typically takes about 30 minutes.
• 🏦 Most banks require an EIN to open a business banking account, although some sole proprietorships may use a social security number.
• 🔑 Another tax ID number is the Business Identification Number (BIN), primarily used for Oregon payroll tax.
• 📋 BINs are issued by the Oregon Department of Revenue and other agencies, and are necessary for businesses with employees or registered corporations.
• 📈 Businesses with a BIN must file quarterly and annual reports to multiple agencies regarding their employees.
• ⚠️ Failure to respond to the Department of Revenue's payroll notices can result in assessed estimated payroll taxes.
• 🏙️ Some cities in Oregon may require a city business license and a city tax number to operate within their limits.
• ℹ️ It is advisable to consult with an attorney or accountant for tax-related questions or to contact the relevant tax-issuing agency.

Q & A

What is the purpose of the Start a Business video series produced by the Oregon Secretary of State Corporation Division?

The video series is designed to help individuals understand the steps involved in starting a business in Oregon and supplements the Business Xpress Startup Toolkit found online.

What are the two primary tax numbers that businesses might need in Oregon?

The two primary tax numbers are a federal tax ID number (Employer Identification Number, or EIN) and a Business Identification Number (BIN).

How can a business obtain an EIN, and is there any cost associated with it?

An EIN can be obtained for free by visiting irs.gov and following the links or searching for 'apply for an EIN'. The process takes about 30 minutes and provides the EIN immediately.

Why might a business need an EIN?

Most banks require an EIN to open a business banking account, and it is necessary for businesses that are not sole proprietorships.

What is a BIN, and why would a business need one?

A BIN is used primarily for Oregon payroll tax and is required by multiple state departments for businesses that plan on having employees or registering as a corporation.

What obligations come with obtaining a BIN?

Once a BIN is obtained, the business is obligated to file quarterly and annual reports to multiple agencies about their employees.

What are the consequences of not responding to Department of Revenue quarterly payroll notices?

Businesses that fail to respond may have estimated payroll taxes assessed by the Department of Revenue.

Do all cities in Oregon require a business to have a city business license?

Not all cities require a business license, but some do. It's important to check with the city government to find out their specific requirements.

What should a business do if they have questions about taxes?

It's recommended to contact an attorney or accountant for questions about taxes, or to reach out to the agency that administers the tax in question.

What additional resources are available for those starting a business in Oregon?

The Business Xpress Startup Toolkit found online and the Start a Business video series are available for more information.

Can a sole proprietorship use a Social Security Number instead of an EIN?

Yes, some sole proprietorships may substitute a Social Security Number for an EIN, depending on the circumstances.