IRS Instructions for a Business Name Change
Owning a business allows you to make decisions that directly affect the company's look and feel. As the owner of an establishment, you have the right to change its name. Upon changing the name of a company, you are required to notify the Internal Revenue Service (IRS). The IRS has instructions on how different business entities submit name changes.
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Sole Proprietorship
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A sole proprietorship is a business owned and managed by one individual. You are personally liable for all business debts and obligations. The IRS requests a sole proprietor inform it of any name changes via mail. Send a detailed notice to the same address you mailed your return. Include business information, the name change and your signature as owner. Changing the name of your sole proprietorship does not require you to apply for a new Employer Identification Number (EIN). However, if you acquire a new partner with your new name, you will have to reapply.
Partnership
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By definition a business partnership is between two or more persons contributing money, property or skills in anticipation of profit. Partners share in all legal and financial obligations. Partnerships filing Form 1065, U.S. Partnership Return of Income, mark line G, box 3, on page 1 to confirm your name change. If you have already filed your return, the IRS requests signed documentation of the name change. Ensure it's mailed to the same location you sent your return and has the signature of your partner. The business partnership EIN stays the same, unless you decide to incorporate.
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Corporation
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According to the Internal Revenue Service, a corporation is defined as a legal entity or structure created under the authority of the laws of a state consisting of a person, or group of persons, who become shareholders. Corporation name changes have appointed boxes on Form 1120 types. For Form 1120 mark line E, box 3, on page 1. The name change field on Form 1120S is located at line H, box 2, on page 1. Corporations that have already filed must send the IRS notification signed by a corporate officer. Knowing which business entity your company files as helps you avoid costly mistakes.
What the IRS Considers a Corporation
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The IRS states that a business can be taxed as a corporation under the Internal Revenue Code. IRS Publication 1635 lists the following businesses as taxable corporations: businesses formed under state or federal law proclaiming it's a corporation, body politic, body corporate, joint-stock company or joint-stock association. Establishments that are entirely owned by local government, an insurance company, certain banks and foreign businesses are also taxed as corporations. Therefore, these enterprises must file for a name change under corporation guidelines.
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