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Old 12-08-2017
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Default Can you attach just your EIN to Paypal Business Account?

So i just started shopify and im getting a lot of sales through a business paypal account that i've made under my dad's name and his ssn since my personal account with my ssn got limited years ago.

Im planning on getting my EIN in the next month so I'm wondering, could I just use this to make a new business account with my nickname as my first name, different address (since I moved), and different phone number? Will it need my social security number attached or is an EIN good enough?
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Old 12-08-2017
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Default Re: Can you attach just your EIN to Paypal Business Account?

Your dad knows about this? Will have to declare the profit and pay taxes for him?
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Default Re: Can you attach just your EIN to Paypal Business Account?

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Originally Posted by rsot View Post
Your dad knows about this? Will have to declare the profit and pay taxes for him?
Yeah he knows. Its only been 2 days with shopify though.
And wouldn't i only have to worry about paying taxes if $20,000 is made in a year?

I'm definitely going to close his account as soon as possible and thats when I get my LLC and EIN setup. My question is could I use my EIN to setup a new business account without needing my ssn?
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Old 12-08-2017
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Default Re: Can you attach just your EIN to Paypal Business Account?

That should work.

Just make sure everything else you follow the stealth guide carefully.
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Old 12-11-2017
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Default Re: Can you attach just your EIN to Paypal Business Account?

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Originally Posted by Rorizm View Post
Yeah he knows. Its only been 2 days with shopify though.
And wouldn't i only have to worry about paying taxes if $20,000 is made in a year?

I'm definitely going to close his account as soon as possible and thats when I get my LLC and EIN setup. My question is could I use my EIN to setup a new business account without needing my ssn?
Pursue the EIN idea and save yourself a lot of trouble. Even if you sell under the threshold, save your father a potential headache and audit. Give him the proper information to file taxes on it and pay him cash. While it is unlikely to be flagged, it is safer to do the right thing rather than illegal over a few bucks.
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Old 12-13-2017
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Default Re: Can you attach just your EIN to Paypal Business Account?

Could one add an EIN directly to an already established account in order to have the 1099-k come to me instead of the current SSN. Or does the EIN have to match the current account holders info?
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Old 12-16-2017
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Default Re: Can you attach just your EIN to Paypal Business Account?

i only have to worry about paying taxes if $20,000 is made in a year

Wow, that's like the most wrong idea I've heard here this year. ( well, close anyway, at least in the top ten ).

Get yourself to a tax guy, cause otherwise you're going to the big house, tax evasion is a federal crime.

Plus you stole your father's SSN so you've put him at risk too...

With family like you, who needs enemies?
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Old 12-18-2017
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Default Re: Can you attach just your EIN to Paypal Business Account?

Quote:
Originally Posted by dallis View Post
i only have to worry about paying taxes if $20,000 is made in a year

Wow, that's like the most wrong idea I've heard here this year. ( well, close anyway, at least in the top ten ).

Get yourself to a tax guy, cause otherwise you're going to the big house, tax evasion is a federal crime.

Plus you stole your father's SSN so you've put him at risk too...

With family like you, who needs enemies?
I thought you had to make 20k and sell over 200 items?
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Old 12-18-2017
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Default Re: Can you attach just your EIN to Paypal Business Account?

Any income that a US Citizen or resident earns is taxable. Its not a reportable event if under $20,000, however your still required to include and file that income. Its likely nothing would happen if you didnt file (as long as a 1099 was not generated), however in the event of an audit, its possible that it could be discovered.
Would you goto the bighouse - HIGHLY UNLIKELY! They would have to prove intent, and that would mean finding your post, linking it to you, and showing that you knew and intentionally did not pay. The IRS is not in the business of imprisoning every day working people. They realize that just about every tax return omits income of some sort. If they audit (which unless your making over $1M per year is a very low chance), and if they discover this, they will merely tax you and make you pay the penalty. They wont even attempt to find out if it was intentional, because its not worth the time and effort to try and prove intent. They want the money, period. Thats what they want. So unless your out there telling people how to avoid taxes, and flagrantly disregarding taxes, and intentionally not paying them, the chances of the big house are almost non existent.
The only reason that they even care if your a criminal, is because if your a criminal, your deductions are disallowed, and you owe more taxes. The IRS cares about MONEY, they dont care about the big house. Your worth more to them outside of the big house making money and giving them a cut of that! money!
Its also never a good idea to post these things on a public forum, because that makes intent pretty easy to establish, if desired.. Its also why "grey" advice is easy to come by on forums for just about everything, yet when it comes to taxes, everyone acts like they are holier than thou. The practical answer is that if you receive a 1099, you'd be foolish not to claim it. Otherwise, its likely not going to be an issue if you forget to include small amounts of revenue.
As for the question regarding your EIN - and SSN Link... Paypal has the ability to verify whatever information was submitted to the IRS when the EIN was applied for. Depending on how the EIN was procured, the entity type, and the state the entity was filed in, will depend on which SSN(s) if any are attached to the entity. If you form an LLC with a member structure using a single member, your EIN will be obtained as a disregarded entity, and your SSN will be associated with the EIN. Paypal will be able to determine if the correct user is listed as the member of the disregarded entity. If they dont match, you will get limited after a relatively moderate level of sales.
There are more complicated ways to set the structrure up, whereby you could remain off the member list, but it requires a fair amount of resources to make that happen legally.
One of the simplist ways to reach your goal, provided your dad is OK helping you, is as follows:
Setup an LLC In Delaware, with your father as the member. Have your father open a business bank account under the LLC, and have your father apply for the EIN under the LLC. Then have your father open a paypal business account under the LLC. You then manage the LLC (which means you do everything, while he is listed as the Sole Member. You Manage the LLC, and run the day to day business. For your efforts, all profit is paid to you in the form of wages, and bonuses. At the end of the year, the business issues your father a K1, showing all income and expenses with zero taxes due, because any profit was paid to you in income and bonuses. The net impact is that there is no taxable pass through income for your father because its all been paid to you as wages and bonuses. So he files the business return with his 1040, but has 0 tax impact, and you report the income and bonus money you received. Thats legal, and thats the way to keep you off of the account while managing the business and being in control of the day to day decisions, and earning the income of the business.

Last edited by zinclepto; 12-18-2017 at 12:36 PM.
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  #10  
Old 01-13-2018
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Default

Quote:
Originally Posted by zinclepto View Post
Any income that a US Citizen or resident earns is taxable. Its not a reportable event if under $20,000, however your still required to include and file that income. Its likely nothing would happen if you didnt file (as long as a 1099 was not generated), however in the event of an audit, its possible that it could be discovered.
Would you goto the bighouse - HIGHLY UNLIKELY! They would have to prove intent, and that would mean finding your post, linking it to you, and showing that you knew and intentionally did not pay. The IRS is not in the business of imprisoning every day working people. They realize that just about every tax return omits income of some sort. If they audit (which unless your making over $1M per year is a very low chance), and if they discover this, they will merely tax you and make you pay the penalty. They wont even attempt to find out if it was intentional, because its not worth the time and effort to try and prove intent. They want the money, period. Thats what they want. So unless your out there telling people how to avoid taxes, and flagrantly disregarding taxes, and intentionally not paying them, the chances of the big house are almost non existent.
The only reason that they even care if your a criminal, is because if your a criminal, your deductions are disallowed, and you owe more taxes. The IRS cares about MONEY, they dont care about the big house. Your worth more to them outside of the big house making money and giving them a cut of that! money!
Its also never a good idea to post these things on a public forum, because that makes intent pretty easy to establish, if desired.. Its also why "grey" advice is easy to come by on forums for just about everything, yet when it comes to taxes, everyone acts like they are holier than thou. The practical answer is that if you receive a 1099, you'd be foolish not to claim it. Otherwise, its likely not going to be an issue if you forget to include small amounts of revenue.
As for the question regarding your EIN - and SSN Link... Paypal has the ability to verify whatever information was submitted to the IRS when the EIN was applied for. Depending on how the EIN was procured, the entity type, and the state the entity was filed in, will depend on which SSN(s) if any are attached to the entity. If you form an LLC with a member structure using a single member, your EIN will be obtained as a disregarded entity, and your SSN will be associated with the EIN. Paypal will be able to determine if the correct user is listed as the member of the disregarded entity. If they dont match, you will get limited after a relatively moderate level of sales.
There are more complicated ways to set the structrure up, whereby you could remain off the member list, but it requires a fair amount of resources to make that happen legally.
One of the simplist ways to reach your goal, provided your dad is OK helping you, is as follows:
Setup an LLC In Delaware, with your father as the member. Have your father open a business bank account under the LLC, and have your father apply for the EIN under the LLC. Then have your father open a paypal business account under the LLC. You then manage the LLC (which means you do everything, while he is listed as the Sole Member. You Manage the LLC, and run the day to day business. For your efforts, all profit is paid to you in the form of wages, and bonuses. At the end of the year, the business issues your father a K1, showing all income and expenses with zero taxes due, because any profit was paid to you in income and bonuses. The net impact is that there is no taxable pass through income for your father because its all been paid to you as wages and bonuses. So he files the business return with his 1040, but has 0 tax impact, and you report the income and bonus money you received. Thats legal, and thats the way to keep you off of the account while managing the business and being in control of the day to day decisions, and earning the income of the business.
Not sure how recent this thread is I'm on my moniker just wow thank you 🙏🏻 for explaining and posting this you are helping people in a serious way
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