Ability to e-file may depend on the length of your name

May 16, 2013 at 1:39 pm (Business, Business Taxes, General Tax Information)

The Modernized E-file System (MeF) that the IRS, states and all tax software use has a required limit of 35 characters for a name, title or description (some states limit to fewer). The main problem is e-filing an application where your name or the name of your business/nonprofit will be set in stone based on what you put in that box, as with an Employer Identification Number (EIN). The IRS, however, only looks at the first 4 characters of the name when an actual return is e-filed. In many cases if your name is too long, you can paper file your application. However, in the case of an Exempt Org. postcard, you have no choice but to e-file.

Therefore, before registering or incorporating your business or nonprofit, you will want to keep the character limit in mind. It is a good idea to also ask the state where you may need to apply for certain tax status or numbers their character limitation as well. If you want to keep a long name, then create a shortened version of it as a DBA to use on your applications and returns.

When you apply for a number with your legal name, you may want to adjust it to fit the character limit as well so that your name, once altered, is as accurate as possible.