In order to notify IRS of your Business Name Change, you either do it via your tax return or a name-change letter. Changing your business name with the IRS is relatively easy. C-corporations and LLCs that have filed at least one tax return can update their business name with the IRS by checking the “change name” box on their annual tax return.
S-Corporations and C-Corporations can mark the “Name Change” box on Form 1120, or for a partnership, check the same box on Form 1065. The IRS will automatically update its records when a business changes its name.
Name-Change Letter to the IRS
The letter you send to the IRS explains that your business has changed its name, states the old and new names, and asks for written confirmation of the change once the IRS has updated its records. The letter must include a current mailing address and a copy of the state-approved LLC Amendment showing the new name. You will also need to update your company’s documents, such as contracts, bank statements, and vendor contracts. You should also inform all your current customers about the change and any other agencies or companies you do business with regularly.
The best way to do this is to create a list of all these entities and to be sure to include them in your letter. This will ensure that everyone, from the IRS to your state, knows about the change and that you have done all the necessary steps to update your information. Once you have notified the IRS, you should inform all the other agencies and companies that you do business with. This includes banks, vendors, suppliers, service companies, and your customers.
The IRS will process your name change application, and you’ll need to wait 45 to 60 days before the new business name goes into effect. It’s important to let your employees, customers, suppliers, and bankers know about the name change as soon as possible after you make it.
Changing your business name is a lot of work and requires you to update all the documents that relate to your business. This includes your business bank account, legal contracts, loan paperwork, and more. It’s a good idea to keep a spreadsheet that lists all the places you need to contact.