Quick Reads · 14 October 2026

Multi-Member to Single-Member LLC: Do You Need a New EIN? Final 1065 and Rev. Rul. 99-6

By Keshav Bansal, CA

Short answer: usually no new EIN for the LLC itself. When a two-or-more-member LLC taxed as a partnership drops to one member, the partnership terminates for tax purposes, it files a final Form 1065, and the LLC becomes a disregarded entity by default. Treasury regulations say an entity keeps its EIN when its tax classification changes, but a disregarded LLC reports income under its owner’s TIN. The EIN stays in use mainly for payroll and excise taxes.

What happens for tax purposes

Under IRC §708(b)(1), a partnership terminates when no part of its business continues to be carried on by its partners in a partnership. With one owner left there is no partnership, so the partnership ends on the date the last other member leaves. The LLC doesn’t dissolve under state law; it just changes tax classification. Under the default rules in Treas. Reg. §301.7701-3(b), a single-member domestic LLC is disregarded unless it elects to be taxed as a corporation (Form 8832, or Form 2553 for an S election).

The EIN question

• The LLC keeps its EIN. Treas. Reg. §301.6109-1(h)(1): an entity with an EIN retains it when its classification changes under §301.7701-3.
• Income tax uses the owner’s number. §301.6109-1(h)(2)(i): a disregarded single-owner entity uses its owner’s TIN for federal tax purposes (individual owner: Schedule C or E on Form 1040).
• Payroll and excise still use the LLC’s EIN. Under §301.7701-2(c)(2)(iv) and (v), a disregarded entity is treated as a corporation for employment and certain excise taxes, so if it has employees it keeps filing Form 941/940 under its own EIN.

Check the IRS “Do you need a new EIN?” page for your specific case, and expect banks or payers to ask for an updated Form W-9 (owner’s name and TIN for income reporting, per the W-9 instructions for disregarded entities).

Filing the final Form 1065

• File a short-year Form 1065 for the period from the start of the tax year through the termination date, with the “Final return” box checked (Form 1065 instructions).
• Due date: the 15th day of the 3rd month after the month the partnership year ended.
• Issue final Schedules K-1 to every partner, including the departing member, marked final.
• Report the remaining owner’s activity after the termination date on their own return.

How the buyout is treated: Rev. Rul. 99-6

If one member buys out the other, Rev. Rul. 99-6 (Situation 1) treats it as:

• Seller: a sale of a partnership interest (capital gain or loss, subject to §751 “hot asset” ordinary income rules).
• Buyer: a deemed liquidating distribution of their share of assets, plus a purchase of the seller’s share of assets. The purchased half gets a cost basis and a new holding period; the distributed half carries over basis under §732.

That split matters for depreciation: the buyer may have two sets of basis in the same assets after the change.

Checklist

1. Document the transfer date in the operating agreement amendment.
2. File the final 1065 and final K-1s.
3. Recompute the remaining owner’s asset basis under Rev. Rul. 99-6.
4. Keep the EIN for payroll; give payers a W-9 showing the owner for income reporting.
5. Update the responsible party with IRS on Form 8822-B if that person changed (within 60 days).
6. Check state filings; some states have their own LLC or franchise-tax steps.

Primary sources: IRS: Do you need a new EIN?; Treas. Reg. §301.6109-1(h); Treas. Reg. §301.7701-2; Treas. Reg. §301.7701-3; Instructions for Form 1065; Rev. Rul. 99-6; IRS: Single member LLCs.

General information, not advice for your specific facts.