Why Does YL Need My Social Security Number for Wholesale Accounts?

Posted in Community Topics, Distributors Tagged with: ,

TWO Emails Regarding Young Living’s requesting SS# – scroll thru_

EMAIL 1 9/4/15)

from Lara to YL – Hi YL Resolutions Team, We’ve had several new business prospects say “no” to the Young Living wholesale kit based on the request for their Social Security number. We’ve always been told this was a standard process with all MLM and wholesale companies required by the government but in further research we discovered this is not the case. Amway, Ava Anderson, Costco, BJ’s Wholesale, Sam’s Club, Celadon Road, Beachbody etc. all do NOT require a social security number. Why is Young Living requiring this (or a Tax ID)? Is Young Living looking into not asking for this in the future? Are there alternatives YL is looking at so we aren’t asking for unneccessary information? Perhaps Wholesale vs Distributor should be different….
YL 1292832

from YL to Lara – Thank you for your email. The reason that Young Living requires a SSN or TIN number, is due to tax reasons. As a member of Young Living, if you make more than $600 in commissions, you are then sent a 1099 at the beginning of the year for taxes. This is a law which is why we require it to create an account. Young Living keeps all sensitive information such as a SSN completely private and would never share that kind of information with anyone.
Another reason we have the SSN on file is to avoid people creating duplicate accounts, which is against policies and procedures. This is something that would come into play with a customer account. A customer would never receive a 1099 since they do not make commissions, but if they ever decided to become a member, they would need to go the route of calling us first to upgrade the account, rather than creating a duplicate in the system as they would be blocked from entering the same SSN.

From Lara to YL – What if customers don’t want to be distributors bit want the wholesale and perhaps the ER without commissions? I’ve come across this alot with my team and no other MLMS don’t require it if you just want wholesale deals. ..Has that been considered for those that are not interested in commission building? I appreciate your feedback and thoughts on this as its coming up more and more with my line causing some frustration…could there not be a way like other MLMS that allows you to switch from wholesale (no commission but discount ) to distributor (discount and commission ), if so, what is Young Living’s rationale not to do this or are they considering other options that allows for this in the future?

From YL to Lara: Lara, Thank you for your email. Currently right now, that is just not how Young Living is set up. Any account that is created does require either a SSN or a TIN. I can certainly pass your email along to the appropriate department for them to further review and consider, for the future. However, as it stands now, any account will need to put in a SSN/TIN.Morgan Andrus,
Conduct Educator
Young Living Essential Oils
[email protected]

EMAIL 2 8/31/15)

This was an email conversation worth sharing for those who ask about the need for providing a social security number with Susan Johnson, Wakefield, RI.  We find it helpful for sharing…

SJ: “Remember the starter kit is something a person gets for becoming a wholesale member. Anyone can buy and Everday Essential Oils Kit (10 oils) as a retail member. It does not come with the diffuser or starter marketing items but they can get the oils at a small discount from buying them all individually – Believe it is about $165 plus shipping for the kit. No need to lose a member (Prices can vary from this date – On Aug 31, 2015, at 2:08 PM)
The distinction is being a wholesale member vs a retail member. If you are signing up to “resell” then you have to give your social security number or an EIN for your company. How else will Uncle Sam get his cut? Anyone who agrees to sell wholesale and potentially make a commission check must be registered with the government to report that income.
Bottom line – A wholesale account basically makes you a sub contractor for Young Living. Subcontractors fill out a W-9 when they work go to work for a company. When you set up an account, you basically are filling out your W-9. You will get a 1099 at the end of the year from YL, if you get regular checks.

Definition of a W-9:

The W-9 is used by an employer to generate Form 1099-MISC, “Miscellaneous Income,” for a subcontractor. Form 1099-MISC is the end-of-year document that is given to a subcontractor so that he can file his tax return. A subcontractor receives a 1099-MISC from each client for whom his earnings total $600 or more in a year. A company that employs a subcontractor is advised to keep the W-9 on file for four years, the IRS reports. Many companies send out 1099’s regardless of how little you make just to keep the government off their backs.
If any company let you set up an account, sent you checks and then tried to chase you for your social security number after you hit $600, it would be a nightmare. So they ask for it upfront – end of story.

Remember, anyone who wants to buy Young Living at a retail price and become a customer – can! No social security number required. Just have them set up an account and buy away. They will pay a higher price and a higher shipping rate for buying retail but they do not have to give their social security number out.

Wholesale members get to take advantage of the wholesale discount, lower shipping rates, Essential Rewards AND a check if they share!

I did go to BJ’s website and they no longer offer a “wholesale” membership. They offer a personal membership, a membership with “rewards”, a membership with a money back credit card or a corporate membership. They have obviously changed their model to reflect that people buy in bulk and not to resell but for their own use (personal or company). This has obviously changed over the years.

As for Amway, they must have a way to get your social security information if you are receiving regular checks – it is required by the government. Ask any sub contractor and they will tell you they have to fill out a W-9 when they are hired or they are chased in January so they can get their 1099.

Things to note – Once a social security number is entered, no one can see it except the Chief Financial Officer and Young Living has never had a problem with someone’s social security information.

Have you ever seen your social on your webpage? Have you ever called and tried to get someone to check your social security number? They will not be able to see that info and will tell you that you need to write in or e-mail a special email address to fix any tax reporting issues. They will not even change a spelling error on a sign up without all the proper paperwork.

I personally asked these questions on a visit to the Young Living Corporate Office.

When giving a presentation, I always mention that the Social Security number will be required. That it is due to the potential that someone can make money. If someone says, I don’t want to make money or I am not giving my social security number! Offer them a retail account. No problem. If they want the benefits of a wholesale account, they must be signed up as a “wholesaler.” If you are squeamish about it – people will pick up on it. Put it right out there. You can quickly lose a crowd if someone causes a fuss and you did not address it with confidence. As always, it will be the person’s choice as to what they decide.

Use the W-9/1099 example and it will probably make more sense to people.

Conversation followed:

CB: But I was told as a retail member they could not purchase the starter kit which is what they wanted in the first place.
August 31 at 3:14pm

MSB:  Thank you very much Susan. I completely understand this and makes sense 100% if you want to get paid. BUT, it is unfortunate though, that a customer can not purchase at a discount with out providing their SSN and they cannot get a starter kit with pr…See More
August 31 at 3:15pm

SJ: Remember the starter kit is something a person gets for becoming a wholesale member. Anyone can buy and Everday Essential Oils Kit (10 oils) as a retail member. It does not come with the diffuser or starter marketing items but they can get the oils at a small discount from buying them all individually – Believe it is about 165 plus shipping for the kit. No need to lose a member smile emoticon
August 31 at 5:12pm

MSB: Ahhhh okay that makes sense then. So there is an option. I got started so quick and focused mostly on wholesale accounts for obvious reasons and never paid much attention to the everyday oil kit. Thank you for the info. I will try and share that if they refuse SSN.
August 31 at 5:55pm”