EIN changes can occur due to Ownership Changes, Mergers, or Acquisitions, and when this happens there are a few considerations to maintain your payroll compliance.
If an embedded payroll customer changes their EIN due to ownership changes, mergers, or acquisitions, the company must immediately notify GoCo via support@goco.io.
Once notified, a CSM will reach out to start the process of transitioning payroll to the new EIN.
Key Steps for Transitioning Payroll to a New EIN:
Create a New Payroll Account: GoCo will establish a new profile for payroll processing under the new EIN. This will be done between your CSM and Signatory for your company, though others may be part of the planning and quoting process.
Employee Transfers: The existing company must terminate employees under the old EIN and rehire them under the new EIN. Timing of this step will be discussed during your new EIN payroll implementation.
Payroll Tax Registration: The company must register for any applicable state and local payroll tax accounts required under the new EIN.
Final Payroll Processing: Ensure the final payroll is successfully run under the previous EIN before closing accounts and run all necessary payroll reports for the old EIN for record keeping.
Close Payroll Tax Accounts: Once the final payroll is processed, if the company does not intend to run payroll again under the old EIN, the company must close all payroll tax accounts associated with the old EIN to prevent missed filing notices or estimated tax balances.
Notify the IRS: The company must inform the IRS that payroll is no longer being processed under the previous EIN. This includes filing quarterly $0 returns until the company is officially closed with the IRS or calling the IRS to inform them that no employees will be compensated under the EIN and date of last payroll. If the IRS is not alerted by phone call or $0 reporting, they will make an estimated filing and issue tax notices against that estimated balance, so this is very important to complete this step.
Note: EIN Changes can be the result of numerous situations, and have many potential outcomes. GoCo recognizes this and this is why we expand off these core steps to help our customers stay compliant and manage their EIN changes.
As always, GoCo support is here to help navigate these complex compliance situations. For any additional questions, please reach out to us at support@goco.io 💚
Disclaimer:
This article is not to be taken as tax, legal, benefits, financial, or HR advice. Since rules and regulations change over time and can vary by location, consult a lawyer or HR expert for specific guidance.