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Changing your entity name with the IRS

Posted by attorney Henry Lively

If you decide to change the name of your company, what do you need to do as far as notification with the IRS?

If you made a legal name change for your company there are a couple of things that you need to do to ensure the IRS knows and recognizes your change of name.

First, there is nothing that you immediately need to do to notify the IRS. When you file your annual tax return with the Internal Revenue Service check the box that indicates on the form (be it form 1065 for partnerships, of 1120 for corporations) that you have changed your name. This will be your notification to the IRS that a change has occurred and they will update your files for the change.

Next, when you file your tax return put in the second name line "Formerly known as 'the name of your previous entity.'" This will help to eliminate any confusion at the IRS office regarding your current and previous name.

You will now need to use your new name for all tax filings -- not just income tax returns. For example, payroll and sales tax reporting forms. You will need to consistently use the new name and indicate the name previously used.

Keep all of the documentation handy in a file regarding the name change and notification to the IRS. It is not uncommon for the IRS to not log the new name change and ask you to provide documentation as to why you are using the new name or why it does not match their records. A good file will solve this issue quickly.

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