LLC Using a Social Security Number

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Question:

Can an LLC use a Social Security number? If so, how would you style the ownership interests -- the customer's name on the first line and DBA the business name on the second line?

Answer:

Certain single-member LLCs appropriately use the member's SSN in their dealings with the IRS.

In those cases, it's appropriate to use the individual's name in IRS reporting. Styling the account may be guided by the limits of your system design. If you have to use the individual's name on the first line in order to report appropriately to the IRS, then do so.

Don't tag the account, however, as a DBA. People have a way of associating that acronym with "sole proprietorship," despite the fact that DBA can be used by any form of organization. In your scenario, the individual is not "doing business as" anything. It's the LLC that is doing business, perhaps with its own name. Use of DBA in the titling of the account might lead someone to erroneously believe the customer could have a NOW account.

First published on BankersOnline.com 10/18/04