What is a Custodianship?

A custodianship is a term used to describe a company or individual who is chosen to hold the finances and/or investments of an entity or individual. Typically, a large corporation will hire a custodian, usually within another firm, to take care of their finances objectively. This individual who acts as the custodian will then have the ability to get a trust tax ID number in order to complete any actions such as making investments, sending payments, etc., simple and easy to complete.

By applying for a federal EIN number, the individual acting as the custodian can handle the finances as well as tax needs of the company or individual. In regard to a company custodianship, the individual does not have the power to oversee or take care of day to day operations of the corporation. The individual will not be able to have access to personal accounts, mortgages, etc.

In most cases, a custodian is a financial situation of some type, though it is not uncommon for an individual to be assigned the role. Either way, the person or entity must be able to earn a classification as a qualified custodian and be able to follow the federal Security and Exchange Commission’s rules and regulations.

Such regulations usually limit the custodianship to dealers, brokers, and banks. When a minor needs a custodian, an adult can be named to oversee the financial accounts of the child until a certain age is reached.

The custodian must be able to provide updates to who they are representing, which will include the need for bank statements and other paperwork. Because of this, the individual must have access to an EIN number so that this information can be gathered. When a new EIN number is needed, a custodian can apply easily online by visiting irs-ein-tax-id.com. An online application process is provided as well as a chat service for any questions or concerns.

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