Do I need a new employer tax ID for a new line of services?

By Nina Kaufman, Esq.

Q.:  My current business is in transportation services and I would like to also offer consulting services. But with the current business name having the word “transportation” in it, clients might not identify the new consulting services. Is a new employer tax ID needed to start a new branch of my current business with a new name?


A.:  Generally, a new employer tax ID is only needed when you form a separate entity—not when you add a line of services to an already-existing entity.

To avoid customer confusion and to give your consulting services their own name, you may want to file a DBA for the company with your state’s Secretary of State. However, whenever you have more than one line of business “housed” in the same entity, you run the risk that financial misfortunes to one line can affect the whole.  Speak to your accountant about how best to account for the different services so that you can evaluate the profitability of each.


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