Creeva’s World 2.0

I orig­i­nally wrote this for Jour­ney To Get Paid.

Any of you that have researched and delved into the world of online adver­tis­ing to any extent have learned that most of these com­pa­nies require you to give them your social secu­rity num­ber. You may won­der why you have to do this and the answer is quite sim­ple, they report the expense of pay­ing you to the IRS. The IRS at this point needs to know who to tax for the income. Any money you make is sub­ject to fed­eral tax laws whether the adver­tis­ers report the money to the IRS or not. How you han­dle your taxes and reported income is up to you but remem­ber the tax ben­e­fits for your cost of doing business:

• Write off host­ing fees
• Write off domain reg­is­tra­tion fees
• Pos­si­bly write off hard­ware (I need to look into this one)

What are your choices?

Now we’ve already stated that the adver­tis­ers need to tax you some­how and your nor­mal tax ID is your social secu­rity num­ber. What other options do you you have? Well lucky for US cit­i­zens there are at least two routes you can take, an EIN (Employer Iden­ti­fi­ca­tion Num­ber) or a TIN (Tax Iden­ti­fi­ca­tion Num­ber). A TIN from what I under­stand works iden­ti­cally as a social secu­rity num­ber for pur­poses such as employ­ment or money received. An EIN gives you busi­ness ben­e­fits. With an EIN you can open a busi­ness bank account and you can apply for a busi­ness license.

How do I get an EIN?

Thank­fully the IRS has made it eas­ier to obtain an EIN than it has in the past. You can apply online. The IRS has setup a web­site that allows you to request one in just a few min­utes. You will need to give them your social secu­rity num­ber, but then again they already have it. You will more then likely choose a sole pro­pri­etor­ship and under busi­ness activ­ity choose and other and when they ask for a descrip­tion type in blog­ging (that does feel good). You don’t have to be a blog­ger, but I’m pan­der­ing to my audience.

After going through a few screens that are all log­i­cal and self explana­tory (if you have have ques­tions feel free to email us and we’ll answer them to the best of our abil­ity). At the end of the process you are given your EIN imme­di­ately and a PDF with your doc­u­men­ta­tion. While you can retrieve your num­ber at a later time I would sug­gest e-mailing your­self the PDF for future ref­er­ence. You now have a legal tax num­ber you can give adver­tis­ers with­out giv­ing them your social secu­rity number.

Why do I want this again? Why shouldn’t I just give the adver­tis­ers my social secu­rity number?

The sim­plest answer is how do you know to trust them? This is about keep­ing your social secu­rity safe from iden­tity theft. If the adver­tis­ers data­base is com­pro­mised your social secu­rity num­ber could be released for any and all to use. If it’s a fly by night adver­tiser that may be offer­ing huge rates — their true busi­ness may be col­lect­ing social secu­rity num­bers. By keep­ing your blog­ging busi­ness sep­a­rate from your per­sonal finance record you can main­tain an eas­ier sep­a­ra­tion from your day job and your online business.

I hope this was use­ful for you and it helps insure your per­sonal security

Be warned though — some sites are try­ing to charge you for the priv­i­lege of get­ting an EIN which is free to you for the taking.

For more infor­ma­tion on the online EIN appli­ca­tion process go here.

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Posted By Creeva Murkado to Jour­ney To Get Paid at 2/06/2008 05:57:00 AM