Tax ID numbers and buying wholesale: What do you need to know?

Selling wholesale is a key revenue channel for many fashion brands. Buying wholesale is also great for retailers, as it helps maximise profits and build better gross margins as they aren’t charged sales tax. 

Buying large volumes of products can seem daunting at first, and the rules and regulations involved are enough to give anyone a headache. Don’t worry though, BLANC is here to help! At BLANC, we’ve been helping retailers buy wholesale from cutting-edge fashion brands since 2015.

If you’re looking to buy wholesale in the US, a tax ID number is a pretty important first step. In this post, you’ll learn what’s required of you as a retailer when it comes to tax ID numbers.

What is a tax ID number?

So you want to buy wholesale in the US? Well, the first thing you need to do is get a tax identification (ID) number. Also known as an Employer Identification Number (EIN), this nine-digit code is used by the IRS to identify your business. You’ll also need a tax ID number for your tax return, to make business purchases, hire employees and set up business accounts with wholesalers.

How do I get a tax ID number?

Luckily for you, the IRS has made the application process very easy. You can apply by filling out an online application through the IRS website. Remember that your business must be located in the US and the person applying for the tax ID must already have a Social Security number. 

Top tip: To speed up the process, make sure that you have the necessary information on hand when you apply, such as:

• Name of the person responsible for the business
• Personal tax identification number of the individual responsible for the business
• Business mailing address
• State registered in
• Type of business entity
• Date the business was legally formed
• Number of employees you expect to be on the payroll in the next 12 months
• Date you started paying wages, if any

Once you’ve submitted your application, you’ll immediately receive your tax ID number as a PDF from the IRS.

Can I buy wholesale without a tax ID number?

The short answer is, no! Businesses that are buying wholesale do need a tax ID number. 

In order to purchase wholesale, and be exempt from tax on your purchases, you must be able to show this number to wholesalers when placing orders. Wholesale businesses must keep these tax ID numbers on file to prove they have only been selling to certified tax-exempt customers.

Does it cost to apply for a tax ID number?

No, you don’t have to pay any fees to get a tax identification number from the IRS.

Ready to start buying wholesale? Take a look at our amazing range of cutting-edge brands on our platform. Contact our team and buy these collections for your store today.