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Paypal Limited - EIN Request | How to register a business?
 

So, my first stealth account (PayPal) received a "limitation" about a month ago for hitting 200+ transactions & $2000+ revenue (which averaged over 12 months would break the 20k barrier, i assume).

Since then, I have been receiving/withdrawing without issues, so I guess the "limitation" is rather superficial - At least until you ACTUALLY hit 20k, is that correct?

I got another email last night saying my paypal was limited until I added on an SSN/EIN, but unsure if this is just a standard email reminder or it's "actually" limited now. Will have to try to sell some stuff to see I guess?

Anyway, I decided I want to apply for an EIN to tack onto this one particular stealth account I have, because it is my "white hat" account.
It just reached Top Rated Seller status, and has 100% feedback, so i figured why let it go to waste.

Both the EB and PP accounts are registered as business accounts, so all I'd need to do is apply for an EIN under the "⊗⊗⊗⊗" business name, right?
Is this hard to do?

Would I apply as a sole proprietor or an LLC?

Also for those who've done this before, what kind of costs am i looking at overall?

Or is this a pointless idea, since it's a stealth account? - Should I reserve all this effort for an actual "real" account under a business name, start off with an EIN, and actually build it up properly?

Thanks

Re: Paypal Limited - EIN Request | How to register a business?
 

In Colorado you can go to the secretary of states web site for $50 and form an LLC, You can form a partnership in any state without filing anything except a trade name registration. The EIN can be obtained at the following link
Apply for an Employer Identification Number (EIN) Online
or by googling how do I get a EIN #

Re: Paypal Limited - EIN Request | How to register a business?
 

Id like to ad , once you get used to it its less work than setting up a stealth account. taxes 30 min tops.

Re: Paypal Limited - EIN Request | How to register a business?
 

So I would need to register the business name first, before applying for an EIN?

Would you suggest I register as a sole proprietor, partnership or LLC?
I do have a friend I'm working with, so maybe a partnership would work, but are there benefits/drawbacks for doing that over an LLC?

If I apply as a sole proprietor, would Paypal be able to link me at all to my SSN or actual name, or it would only use my EIN?

Re: Paypal Limited - EIN Request | How to register a business?
 

You can apply for an EIN right now and have it within minutes on the IRS website using joew8989's link. You don't need to register the business name first. You could do it right now actually.

The type of business you select really depends on your business model. Definitely do a bit of research and then choose because no one can really say which would fit you the most. When applying for an EIN using the above link, the IRS even provides a short description about the various business types so that's a great start.

Paypal will only know about the main information you used to register the EIN with (business name and address).

If you are completely new to forming a business, you may want to look into using LegalZoom. They make the process painless and do all the work for you. But it will cost more compared to doing it yourself at the state's website.

Re: Paypal Limited - EIN Request | How to register a business?
 

You can register for the EIN on the IRS website. That is the main obstacle for getting past the PayPal limitation. You need the Biz name registered with IRS to match that given to PayPal.

As to if you need to do a DBA. Or register a LLC or decide what type of entity you are. That is all things outside of PayPal requirements. They are not outside the law don't get that wrong. Most states you also need to file for a "Sellers Permit" each state has different names but it is a certificate for collecting sales tax for purchases within the state where applicable.

Some states also if you are a sole proprietorship you don't need to file a DBA name. I know Arizona is one. In California if you Last name is part of the business name you don't need to do it either.

For stealth users who have a b.s. name registered on the account. The one thing you must know. Is if you get the EIN and comply with the Tax ID requirement. If/when you go over the 20k/200 transactions and they send you a 1099k at the end of the year. It has the PayPal owners name on the account not the business name. So keep that in mind.

Re: Paypal Limited - EIN Request | How to register a business?
 

So if the 1099 has the owners name and not the business name wont paypal see your real name? Any way to get around that?

Re: Paypal Limited - EIN Request | How to register a business?
 

So not sure if what I did was correct, but we'll see how it goes.

For those interested, what I ended up doing:

Registered a sole-owner LLC under my eBay business name.

I used the business name, and business stealth address (In Florida) but I put my real "return" address on it (NYC) for shipping location. The return address I use is my office, which has not been associated with any past accounts, so it's safe for me to accept returns / ship items from.

So far it's been about a week without issues, and they removed the limitation on PP within a few hours of submitting EIN.

Re: Paypal Limited - EIN Request | How to register a business?
 

I also went ahead and made an LLC, but i went the easy out , I went to Incfile.com and it was about $250, They will have it ready in 10 to 12 business days. Im also having a website made. Im basically registering as a website hosting company.

Re: Paypal Limited - EIN Request | How to register a business?
 

So what's a way around if you receive 1099k for the name of unexisting person? Does IRS ask you about who that person was, or you just proceed with taxes by your SSN on their file and the're happy?

Re: Paypal Limited - EIN Request | How to register a business?
 

This is the main part of the letter they give you when you register for a EIN. I have only done Sole Proprietorship. Some form of corporation could be different. Also there is a misconception by some members on the site you can get a new EIN every day. Which technically is true but you are only allowed a single EIN as a Sole Proprietor all other must be some form of Corporation. I hope this helps.

http://i37.photobucket.com/albums/e5...iagain/EIN.jpg

Re: Paypal Limited - EIN Request | How to register a business?
 

I would love to know the answer to this, if anyone has any input.

Thanks.