Wednesday, August 4, 2010


A federal employer identification number (FEIN) would probably be easier to understand if it were only issued to, you know, employers. But as you've probably noticed, things are never what they seem to be in connection to finance, taxation, and other testable points. An estate also receives an FEIN, which I learned when serving as executor several years ago. A trust receives an FEIN. Estates and trusts are legal entities/legal persons. Like corporations and partnerships, they receive FEINs from the IRS. If you go to the IRS website and type in "fein," you find a helpful table that determines if somebody needs to apply for an FEIN. If the answer to ANY of the following questions is "yes," then the person needs to get a federal employer identification number:
Do you have employees?
Do you operate your business as a corporation or partnership?
Do you have a Keogh plan?
Are you involved with: trusts, estates, REMICs, non-profit organizations, farmers' cooperatives, plan administrators

Is this informatoin testable?
Sure. If NASAA says that "taxation issues" are testable, they only give a couple of examples as to which items we should focus on. Everything is, apparently, testable. And, since business entities are a testable item, we have to assume that you might need to remember what an "FEIN" is and that trusts and estates have them, as do corporations and partnerships.

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