Unable to Verify LLC Tax Information - Solved!

[SpaceBrainCircuits]

I spent the last month and a half trying to get my shop transferred from a Sole Prop to my newly created LLC.  It was a complete nightmare that I wouldn't wish on anyone. After countless calls with Etsy, emails, scouring the web, I finally got it figured out and I want to pass along the info so that it might help someone else.

After switching all information to my LLC on the Legal and Tax Information page, I received the same error message... "Please ensure you enter the correct Name associated with your tax ID provided and a valid Social Security number or Employee Identification Number"

I went back and forth with Etsy for a month. After confirming my EIN was atleast 10 days old, they had me trying different Legal Entity Name formats in order for my EIN to match. My LLC in particular is set as a disregarded entity so I tried the following per Etsy support. For example:

Name LLC First Name Last Name
Name LLC DBA First Name Last Name
Name LLC First Name Last Name Sole MBR
Etc...

Unfortunately, the IRS only allows 5 attempts per 24 hours so it was a very slow process. My account quickly became suspended and placed on vacation mode. Eventually, I was offered the ability to upload all LLC documentation which went through another Etsy verification process. I figured Etsy could just verify manually and all would be well! But no, same error after this was completed so I opened another support ticket. The first call, my support agent ensured me I just needed to wait another day and my shop would be up and running. I waited a week and nothing. All support agents had the same story, call the IRS and find out the exact Legal entity name formatting, which the IRS confirmed everything looked perfect. I was on my own!

After spending some time researching EIN matching, the process the IRS uses to verify EINs automatically is called TIN matching but this is typically only available to tax professionals. BUT, there are 3rd party services that will run TIN matches for you. So, Of course, I spent 25 dollars, just to have the ability to potentially figure out why my legal name wasn't matching.

https://tincheck.com/
First TIN match is free btw!

I quickly found that the TIN match is very forgiving after attempting a few test matches. In fact, im 99% sure the TIN match only verifies the first 4 characters of your legal entity name. So I went back through my etsy account and thats when I noticed it!

When setting up your LLC, it's required to have a business bank account, so this was one of the first things I updated on Etsy. However, I never updated my billing card. It was still linked to a personal debit card under my personal name, not my LLC. As soon as I added my business bank account debit card, and updated my tax information I was instantly verified! I am still in disbelief!

This is a really simple fix that Etsy support should have caught on my initial call.

TL;DR

Etsy Support is wrong, and they are zero help when it comes to legal and tax information.  All the attempts at different legal name formats is a waste of time and unecessary. This is not the issue.

The Fix:

Your Bank account AND Billing Card must be using your legal entity name, not your personal name.

Billing: Finances -> Payment Settings -> Billing

Good luck!

[ArtDollsbyJD]

Not all states require the same for starting an LLC.  I never went for an LLC because as sole proprietorship there was not advantage and yes I have an EIN number.  I don't live in a state that requires an LLC which I know some states do.

There are plenty of sellers on here that use their legal full name for their bank account and they are an LLC.

You maybe just got lucky.

[PrairieViewBoutique]

There may not be tax advantages but there are legal advantages that many sellers might enjoy.

[SpaceBrainCircuits · Accepted solution]

I am in the state of Illinois and we also do not require an LLC to operate. I opted for an LLC for other reasons. It's possible that there are different tax info forms based on where the seller is located. In any case, my solution worked for me. Hopefully it can help others that are stuck.

I would be very surprised if luck has anything to do with it. Its much more likely the system was expecting certain parameters that were not getting met. Hence, my billng account not matching my LLC. Thanks!

[PrairieViewBoutique]

Thank you for sharing and I suppose this is worth a try.  Technically, my business credit card could go under either name, my own or the entity, since the card is issued to a specific person but if it's just an internal thing I am will to see if that will work.

[AnnsVisionsofHeaven]

This is great info.

In my case, the address my lawyer used on the LLC state form was one for privacy and not my home address so that made a differences.

As well I had to use a format of the business names XXX LLC that was different than the exact one on the IRS EIN form but matched the one on the state website.

And as you said, the payment info has to be consistent.  

Aftter over a month of corresponding I did reach someone knowledgable who knew the correct format and the issue was fixed in five minutes.  

** Here is what finally worked for me:

Business name of legal Entity
XXXX, LLC (taken from the state website - in my case AZ corporation commission)

Business Address
Address From State website for your LLC
(might not be the same as your personal address depending on who set up your LLC and whether or not they used an alternate address for privacy. Look at the state website and copy exactly)

Entity number:
From State website - the number that was assigned to your LLC when formed

EIN - self explanatory & see the entry above for checking - great info

NAME & ADDRESS for taxes
In my case I am a one-person LLC so I counts as a disregarded entity for taxes
In the tax section, I used PERSONAL NAME and PERSONAL ADDRESS that I use when actually filing my taxes.

These settings worked for me
Hope it helps.
Ann

[SpaceBrainCircuits]

Thanks for sharing!

[PixelsnPlastic]

I tried everything, but Etsy still placed my store on "limited" visibility—even though I had been selling as an "Individual" for a full year. Worse, they locked my store, meaning no ads could run. I had already uploaded and verified my EIN and LLC documents with Etsy. I even tried changing my name to my First + Middle name in the "First" field, as many on Reddit suggested, but that didn’t work either.

After repeatedly clicking "this was not helpful" in the Etsy help center, I finally got the option to request a call. I spent 45 minutes on the phone with support, but they couldn’t figure it out either. They told me I’d receive an email from tier 2 support, but after a week, nothing came.

Frustrated, I switched back to "Individual Seller," and suddenly, my store was fully unlocked, with ads running again.

It's ridiculous that filing for an LLC and getting an EIN from the government is so simple, yet an online store's business tax section is completely broken with no easy way to reach support. I really wish there were better alternatives to Etsy.