There are many reasons why you would choose to operate your TLC business as a Business Entity or a partnership, rather than as an individual. Most people choose this option primarily for tax purposes. Please note that you should always consult with your tax professional before you make this request. This option is only available for businesses registered in the United States.
It is a relatively simple process.
Business Entities (LLC, Corporation, d.b.a.)
To begin, you first need to apply for an Employer Identification Number (EIN). You do this through the Internal Revenue Service (IRS) website, www.irs.gov. The EIN will be associated with a business entity such as an LLC or a d.b.a. (“doing business as”). However, if the d.b.a. is a sole proprietor, i.e. one member, an EIN may not be necessary. Once again, you should consult with your tax professional about the best option for you.
Once you have been assigned the EIN and created a business name, you must register with the state in which you want to do business.
After enrolling as Life Changer with TLC, you may request to change your individual account to a business account. You may also enroll with the fictitious business name. In either case, the Compliance Department will request certain information to complete the enrollment.
You must provide the following:
- Copy of the IRS letter with the assigned the EIN
- Copy of your Articles of Organization or d.b.a. paperwork
- Completed TLC Business Entity Enrollment form
The Business Entity Enrollment form requires the names and Social Security numbers of all Company Principals.
We request this information to prevent any violations of our Policies and Procedures, such as duplicate accounts, and/or other manipulation of the TLC Compensation Plan.
Please be aware that an LLC must be Active and in Good Standing with the state in which it is registered.
If you do not provide all the information, the application will be denied until the information is received. If the LLC is not active or not in good standing, the application will be denied until the account is brought current.
When the information has been verified, your TLC account will be updated as a business entity. Your TLC Pay Portal will also be updated to reflect this information.
If the account earns more than $600.00 in compensation, a 1099 will be issued at the end of the year in the name of the company.
Partnerships
Partnerships operate a little differently. A partnership is an agreement between two or more people. Partnerships do not have fictitious business names. Partnerships do not have an EIN. You would not have to provide an IRS letter or Articles of Organization. However, you would still need to complete the Business Entity Enrollment form with all the partners’ names and Social Security numbers.
One person will be designated as the main partner and his/her Social Security number will be used for TLC pay and for 1099 tax reporting purposes.
TLC does allow for partnerships in other countries, particularly between spouses. However, since we do not report taxes to various governments, it is your responsibility to ensure that you abide by all laws and regulations in your country of residence.