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Trade Associations
Food and Agricultural Produce
From Malaysia
To Taiwan
14 views / 0 experts
Nov 17, 2020

My partner and I started a business three years ago, but I ended up buying him out earlier this year. Now that I run the business by myself, the IRS says I have to apply for a new tax ID, but all my records are under my current tax ID. What should I do?

1 answer

David W.
Not rated
Nov 17, 2020

Under IRS rules, buying out your partner constitutes a "change of status" that requires you to get a new federal tax ID number. But because you bought him out earlier this year, there's still time to consider making your spouse or significant other a partner with a 1 percent partnership interest. That way, you'll preserve your status as a partnership and can keep your current tax ID number. Just don't "backdate" any documents, as that will get you in serious legal trouble if you're found out.

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