Getting an EIN: LLC vs C-Corp

If you're not planning to raise institutional venture capital soon, an LLC taxed as a disregarded entity is almost always simpler and cheaper: no corporate-level tax, one annual information return instead of a full corporate filing, and full flexibility to convert later if your plans change. Form as a C-Corp from day one only if you already know you're raising a US-led VC round in the near term, since most US VCs specifically want Delaware C-Corp stock, not LLC membership interests, and converting an LLC to a C-Corp after the fact (versus a state-law conversion or a new entity plus asset transfer) adds legal cost and complexity that's avoidable if you know your path early. There's a middle path too: form the LLC now for simplicity and cost, and file Form 8832 later specifically when a term sheet requires it -- this defers the complexity until it's actually needed rather than paying for it upfront on the chance you'll need it eventually.

The real differences show up downstream of the EIN, not in getting one. An LLC with a single non-resident owner defaults to disregarded-entity status -- no separate federal tax return beyond the informational Form 5472 and pro-forma 1120. A C-Corp files a full corporate return (Form 1120) every year regardless of activity, pays a flat 21% federal corporate tax rate on profits, and creates double taxation if those after-tax profits are later distributed to shareholders as dividends (taxed again at the shareholder level). Concretely: a C-Corp earning $100,000 in profit pays roughly $21,000 in corporate tax, and if the remaining $79,000 is distributed as dividends, the shareholder pays personal tax on that too -- versus an LLC's single layer of tax at the owner level. Founders sometimes form an LLC specifically to avoid this double layer, then later elect C-Corp tax treatment via Form 8832 once they're raising venture funding that requires it (many VCs require a Delaware C-Corp structure) -- in that case, the EIN doesn't change, only the classification election attached to it does.

Both LLCs and C-Corps require a 'responsible party' on the SS-4 -- the person with ultimate control over the entity's funds and assets, as the IRS defines it. For a single-member LLC, this is almost always the owner. For a C-Corp, it's typically the principal officer, though this gets murkier with multiple founders or a foreign parent company, where the IRS wants a natural person, not another entity, listed whenever possible. Non-resident founders without an SSN or ITIN enter 'Foreign' as the responsible party's ID type on both entity types -- the process doesn't discriminate by structure. One frequent multi-founder question: only one person can be listed as the responsible party on the SS-4, even if ownership is split evenly -- this doesn't affect equity or control, it's purely an IRS point-of-contact designation.

EIN processing timelines are identical for both structures: 4-7 business days by fax for non-resident applicants without an SSN, since online application isn't available to you either way. Once you have the EIN, an LLC founder's next step is usually opening a US bank account and, if applicable, planning any future Form 8832 election. A C-Corp founder's next step typically includes appointing officers and directors, issuing initial stock, and adopting bylaws -- paperwork an LLC doesn't need at all. Both entity types need the EIN before they can open a US business bank account, apply for a Stripe or payment processor account, or file any federal tax documents, so this step is a genuine prerequisite regardless of which structure you choose.

Strip away the entity type question and Form SS-4 asks an LLC founder and a C-Corp founder almost exactly the same things: legal name, responsible party, mailing address, reason for applying, expected number of employees. The one field that changes is Line 8a-9a, where you tell the IRS what kind of entity you're forming -- 'Limited Liability Company' with the number of members, or 'Corporation' with the state and form number of your incorporation document. Get this field wrong (a common mistake is checking 'Corporation' for an LLC that plans to elect corporate tax treatment later) and you can end up with an EIN tied to the wrong default tax classification, which then needs correcting via Form 8832 rather than a simple call to the IRS. The rest of the form -- name, address, responsible party, reason for applying -- is copy-paste identical regardless of which box you check on Line 8a-9a.

Line 13 of Form SS-4 asks how many employees you expect in the next 12 months. Most non-resident founders forming a lean LLC enter zero, which is accurate for a solo founder with no US-based staff and is not itself a red flag -- plenty of legitimate EINs are issued to zero-employee entities. This answer matters more for a C-Corp planning to hire a US team quickly, since it can trigger different IRS follow-up correspondence (payroll tax deposit requirements, for instance) sooner than for a dormant LLC. Neither entity type is required to have employees to get or keep an EIN -- this is purely informational for IRS planning purposes on their end.