EIN Registration Issue

[niimae]

First of all, let me start by stating that today I realized I must be a complete idiot...I mean just really, utterly stupid in a way that's actually scary.

So: I've been running a web-site that earns revenue via advertisement for roughly 2 years. I though it would be a good idea to register an EIN number for a sole proprietorship yesterday (01/31/2011) using the the IRS EIN tool found on their web-site. At this point, I think I was doing completely well.

My wife was disappointed that I had founded a sole proprietorship rather than a partnership since she also helps post articles to the web-site. Having hastily skimmed two rather vague articles on partnership and (foolishly) determining that a partnership would be virtually the same thing as a proprietorship, I proceeded to use the same tool on the IRS web-site to register an EIN for a general partnership (02/01/2011) in a mad attempt to make things "right." I used "change the nature of an existing business" for the reason for registering yet another EIN number.

Immediately after the registration, I was presented with a request for a 1065 form by 04/15/211 - a kind of cold, what have you done kind of feeling crept over me and I started to search for more information on general partnership. I was then able to realize that a partnership was not only something I didn't want to form, it's something that is entirely too expensive for my small web business that just barely pays the bills at this time...I'll also add that I am fairly convinced that I haven't actually taken the proper steps to even legally be considered a partnership...and (yes there's more) under "doing business as," I took one more big step out of the short-bus and put my website name - which is not registered as a business name, nor is Sullivan & Sullivan (the partnership name I entered).

I just want this partnership nightmare I've created to go away. Do I have to go through with this? Do I need to register yet another EIN number to return to a sole proprietorship? Will I still need to file a form 1065 if I can dismantle this monster today? Please write in small sentences - because, as I stated before, I think I must be really slow today...

[vangogh]

My first business was a partnership and I don't recall it being expensive. I remember filling out a couple of forms and maybe spending $30. I'm sure I have amount wrong, but it far from expensive.

IRS form 1065 (PDF) (http://www.irs.gov/pub/irs-pdf/f1065.pdf) is a return of partnership form. It's not a form for forming a partnership. I'm not really sure why they requested you fill it out.

I doubt you've done anything that can't be undone. I'd give the IRS a call and just explain what happened. I would think if you talk to them soon enough they can set things up how you want without any problems for you. I've generally found the IRS to be very helpful whenever I've given them a call.

Decide how you want to set up your business first. Neither a sole proprietorship or a partnership is difficult or expensive to set up. The partnership will be a little more complicated come tax time. I think it's just an extra form or two so not much more complicated, but it is extra forms. Then give the IRS a call and see if they can help sort out the EIN issues.

[Evan]

At a minimum, now that you requested the EIN, the IRS will (generally) be expecting a 1065 for that partnership return come the end of the year. Though as a husband and wife, you are probably a qualified joint venture under the interpretation of the Small Business and Work Opportunity Tax Act of 2007, and could get away with filing two Schedule C's reporting each of your share of the partnership income/loss.

[jamesray50]

When did you put that your business started? Did you put 2010 or 2009? You may also have to register with you city or county.