Monday, July 9, 2012

Online Commerce: Beware of Tax ID Scams

As I finally work my way toward opening Heaven's Wait's online store, I must shake my head in disgust at the creative ways people try to take hard-earned dollars from unsuspecting new business owners who don't quite know the ins and outs of completing the bureaucratic processes. Fortunately, I've learned a few things, since I've gone through the business startup process several times in the past.

Once I finally got past the LLC application process with the State, I went online to apply for an EIN, Employer Identification Number. My Google search of EINs gave me a variety of options. I went to the top option because the web address began with IRS. I completed the basic form for obtaining an EIN. When I went to submit it, I was sent to a billing information form. WHAT? I knew there was no fee involved in obtaining an EIN. At the bottom of the form, there were two options. The fee for obtaining the number was $179.00 for standard delivery in 3-5 business days, or $247 for rush delivery within 1-2 hours of submission.

At that point, I knew it was time to cancel the application. But wait! When I hit the back arrow, I was taken to a page that offered me some time sensitive deals with a coupon code and everything: $97 for standard delivery and $197 for rush delivery. Wow! How nice of them!

I closed out the tab and went to the official IRS website, where I quickly found the correct application, which by the way asked for the exact same information. I submitted it and immediately received my number online, along with an official IRS confirmation letter verifying the submittal and receipt.

There is no reason anyone should ever use such a company to apply for an EIN. They are not doing the work for you; there is no convenience factor. You still have to provide them with the necessary information. I'm surprised the government has not shut down such operations.

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