Frozen Account Due to Unverified Tax Information

[#1]

I formed an LLC in the state of MS and obtained an EIN number for this LLC. I correctly updated the tax information on Etsy. However, my shop was being frozen due to unverified tax information. It has been over two weeks and Etsy has been completely responsive to address the issue. I was not even recognized that I have been having this issue on my account. When I wanted to update the tax information with my SSN, I could not do it. I have been asked to update my tax info, but I cannot make any changes there. Etsy is not addressing the issue at all. Any ideas what to do at this point!

[LostFortyThrift]

Hi! My account was frozen too and after reading all of these responses I found my SS card and ended up adding my middle initial since that's how it is on my card. Opened my shop right back up! Good luck! I feel your pain.

[GreenlavaVintage]

This is so frustrating. Is this a glitch in their software? My whole shop is froze. They have all the correct info. Hope are this gets resolved asap for all involved. 

[GreenlavaVintage]

So someone on this threaded recommended when you update , for me Im a sole proprieto,  to use exactly whats on your SS card. I was leavi g off my middle name before. As soon as I added the middle name it fixed it right away and store is back up. Hope this helps others. What a pain in the a$$

[EAFashions]

Hi,

DId Etsy unfreeze your account? If so how long did it take?

Thank!

[Spottedwoodchuck]

when I logged into my account, I kept getting the message saying if we did not provide a SSN or EIN before we reached $500 in sales for the year our account would be locked.  Its only Jan. so I wasn't too concerned but I had a buyer wanting to make a large purchase which would put us over the limit.  so to be proactive I applied for an EIN as we will be needing it this year anyhow.... got the EIN input it in as the form from the IRS stated it should be input.  Etsy's system accepted it and all was well.  two days later I went to ship an item and guess what?  My 180 active listings have disappeared, and my account has been locked due to invalid tax payer information.  My buyer has not made that large purchase yet, so I'm still not close to the $500 limit, but my account is locked and I've given them an EIN.  So I go into Etsy's system to check my tax payer info, it is input correctly according to the IRS form, and etsy's system accepted it... I cannot figure out the issue.  I tried to find a number to call for etsy support help but guess what?  us sellers cannot call them, only buyers can?  So my two options for help are etsy chat or email.  It takes me 10 minutes to locate a topic that slightly resembles my issue, click on it and start a chat.  They pass me around a few times, giving me the same line we are experiencing higher than normal blah blah blah... and now i'm given to a specialist who still cannot help me, they pass me along to another "team" and the "team" cannot help me so they have to submit an email request.  I kept checking my email to see if they had responded and thats when I get an email from etsy saying that the IRS says my name and info did not match their records....so my tax payer info is invalid.  WHAT?!!!!!  log into etsy and the message is there again, your tax payer info is invalid you must input a valid blah blah blah.  So I grabbed my form from the IRS and double check, IT IS CORRECT!!  I click here and there, change this and that, make this in all caps and that in lower and you know what, it accepted one of those crazy combinations...not the way that the IRS wants it but etsy took it.  That was Saturday afternoon, now it is Tuesday afternoon.  My account is STILL frozen, no reply to my chat or email request for help, and my star seller status...HA kiss all that hard work goodbye!  I started another chat today, they couldn't help me either, it has been sent to support with urgency.  So disappointed, so frustrated, so annoyed!!!!!  

[BARBJPRODUCTS]

At least you are getting replies.  I am getting nothing from them - no answers - no emails - and I called IRS - they gave me my EIN number, but Etsy says its invalid?  So I put my social # in there and they accepted that, however my store is still frozen and all my products are gone so no one can order anything - and my 5 star listings AND my honor bag for a star seller - all gone!!!  Months of hard work to get here and now this.  I am so devistated over this.  I don't know where to turn next?  My daughterinlaw had same problem with her store but as soon as she entered her numbers they reopened her store in 2 days.  I am going on a week now and nothing!!!!

Perhaps they have so many people complaining about this problem they are over run?  I don't' know.

[giftcenter]

So frustrating to hear that many sellers are going through this experience and etsy is still not addressing the issue at all. Once I talk to customer service, it is so annoying that they act as if they received this problem the first time. A lot of etsy sellers are having this issue and if there is something that needs to be revised with the corporation of LLC properly, that can be also clarified. 

[FenderGemsNCrystals]

Add back you SS#, your Personal SS#.  Etsy is having issues accepting EINs.  

[EpiclesisConsulting]

@FenderGemsNCrystals 

Etsy has NEVER really liked dealing with sellers as business entities rather than as human individuals. I can imagine it not having occurred to the employee(s) in charge of coding the software for this change in the 1099 threshold that some shops would have EINs rather than SSNs, and then, when they did realize it, not making it a very high priority to deal with.

Truth be told, I can even imagine them for some reason wanting to get their hands on SSNs and deliberately using this situation to put as many sellers as possible in a position of having to input them.

I am not at all close to the $500 mark yet, so I'm going to hold off a while in hopes that they get this ironed out. I prefer to give my EIN rather than my SSN. Etsy just is too cavalier in how it handles private information for me to put my personal SSN into their hands if I can possibly keep from doing so.

Trish O'Connor
Owner, Epiclesis Consulting LLC

[FenderGemsNCrystals]

@EpiclesisConsulting  Etsy has moved from cavalier to downright callous.  I will be retiring soon and converting this to a hobby business.  It can't come soon enough.  I am having second thoughts about Etsy and considering moving my hobby business to eBay or elsewhere.  

[EpiclesisConsulting]

@FenderGemsNCrystals 

Best of luck to you with whatever you decide. I wish you a happy retirement!

Trish O'Connor
Owner, Epiclesis Consulting LLC

[LadyInStitches]

The problem folks are having (in some cases, not all) is that they are trying to enter their LLC information as an incorporated business when they are sole member LLC's which are not corporations. They are still an individual. They are considered a "disregarded entity" for federal tax purposes and should use their personal SSN or personal EIN if they have one.  If they got an EIN as a sole proprietor BEFORE they got their LLC EIN, they can use their personal EIN.  The IRS very specifically says that your SSN or personal EIN should be used for information reporting purposes (translate to 1099)

[EpiclesisConsulting]

@LadyInStitches 

You may be correct that this is the issue, but for whatever it's worth, I did consult with my tax preparer today, and she said I should be able to give my EIN for this purpose. (And that kind of makes sense to me. The IRS knows what SSN goes with the sole member of the LLC with that EIN. But "makes sense" and "IRS" don't always go together.)

I suspect that if I were to email Etsy asking for clarification, I would just get a canned reply saying that they cant give tax advice, but that wouldn't answer whether their software would allow me to follow a professional tax preparer's advice.

Maybe I'll continue to wait a while and see if people stop running into this problem.

Trish O'Connor
Owner, Epiclesis Consulting LLC

[BARBJPRODUCTS]

The only think that I think we can do at this point is go somewhere else.  BUT where else are we going to find a company that advertises for us.  Nowhere.  I am wondering - when they freeze an account like this, does it mean that they have closed us out forever?  Is freezing the same as closing our accounts?  All of my products, star badge, reviews have all disappeared........I am supposed to be retired, but the way life is I have to keep on working at my age....my Etsy store was supporting me well......and now I'm lost.  I am 80 years old.....LOL         Still able to work and manage things - this is really scary that they have so much control over our lives.

[giftcenter]

I have been also thinking of a potential alternative site, but Etsy is dominating handicrafts. 

What happened to my shop was that I was not able to even update my tax info with my SSN after it was frozen. It was first frozen when I put my EIN and I went back to update it with my SSN. But it did not go through. After I cleared the cache on chrome, I was able to update the tax info with my SSN. Then, the shop is opened.

However, the problem is still there. I understand that LLC is not regarded as a corporation and I am now trying to understand how I will turn my LLC into a corporation rather than a sole proprietor.   

[BeezBagzShop]

I'm having the same issues and have double checked the name and Tax ID# and I've entered my info correctly.  It's been 2 days and it's frustrating not being able to talk to a person to help.  You have to wait 24 hours to respond and still can't fix the issues.  In the meantime, we're wasting our days not being able to sell.  So frustrating.

[BARBJPRODUCTS]

They still have not fixed my issues yet.  I am beginning to wonder if they ever will. Going on a week now.

[giftcenter]

Unfortunately, a lot of us have been going through this frustration for some time. It is so annoying that Etsy remains silent on this issue. We cannot talk to a customer representation and even online chat is being disabled. What we can do is just to petition that our account be reopened. 

[AnnyAbby]

Hi BeezBagzShop, did you get it fixed? Please, let me know I am having the same problem.

[BeezBagzShop]

Hi AnnyAbby,  Yes,it got fixed but they didn’t help at all.  I re-enterd my SS #, I entered exactly what it shows on my SS and it opened up instantly. Try that and I hope it works for you.  
Good luck.

[BARBJPRODUCTS]

You know its a possibility that because there are so many issues - they are scrambling to fix it and thats why we think they are not doing anything.  I am sure if there are this many complaints in here - there are many other complaints out there besides ours.  We are probably only a drop in the bucket?  Guess I'll give them the benefit of the doubt but in the meantime we are losing our shirts.

[StitchWizard2016]

looks like i may be going over to ebay. At least they have a phone # so you can contact someone. 

[AnnyAbby]

Hi BARBJPRODUCTS, did you get it fixed? Please, let me know I am having the same problem.

[GrammiesHats]

they just closed my shop because they say my (NEW) EIN is incorrect.  I tried to send them the verification paper and got the answer that this is not a reply number.  How do I contact them?  I DO NOT want to give them my SS number so I applied for an EIN .  do they have a number I can call?

[EpiclesisConsulting]

@GrammiesHats 

I have a question in to my tax preparer about whether, as a single-member LLC passing my income through to my personal tax using Schedule C, I am required to give Etsy my SSN rather than the LLC's EIN. I have not yet received the tax preparer's response, but I do wonder if this might be why so many people are having trouble getting Etsy's software to accept their EIN.

I very much empathize with wanting to give them EIN rather than SSN, but we may not have a choice in the matter.

Contacting Etsy is not easy! It doesn't help that the method(s) offered, and how to find them, keep changing. To try to find a pathway that would allow you to request a call, just now I tried starting at this help page: https://help.etsy.com/hc/en-us/requests/new?segment=selling#issue_sell_us_taxes-solution_primary

Then I scrolled to the bottom and clicked the "I still need help" button. Sometimes, that leads to a form where you can request that Etsy call you, or to a link to live chat support. Unfortunately, right now, all it takes me to is an email link. I realize they often take a long time to respond to emails, and when they finally do, it's often a canned message that doesn't really address the question you asked. But you could email them asking for a call, and see if that does any good.

Trish O'Connor
Owner, Epiclesis Consulting LLC