Over on the Dr. Freelance Jake Poinier answers a reader’s question about LLC/corporate entities for freelancers.
My own view on this is that even if you don’t form an entity (initially or ever), at least acquire an EIN (also known as a Federal Tax ID Number) just for your business activities so you don’t end up giving out your Social Security Number (SSN) to clients…
Getting an EIN was one of the first things I did because there was no way I was going to be handing out my personal SSN to clients. And doubly so when I’m doing information security consulting for them. 🙂
It was a pretty simple online process a few years ago and I even got it instantly (which was good because I needed it for a new client request that day)! It looks to be the same straightforward online application process to get an EIN from the IRS these days. Anyhow, go see what else Jake has to say on the LLC/incorporating topic and decide what makes the most sense for you. (The specifics of this are US-centric, but the principles apply elsewhere I imagine.)
Josh Richards 