An EIN, or Employer Identification Number, is essentially a Social Security number for your business. It’s a unique nine-digit number assigned by the Internal Revenue Service (IRS) to business entities operating in the United States. Think of it as your business’s federal tax ID, crucial for various operational and compliance purposes.
You can obtain an EIN directly from the IRS without any cost, and the process can be completed in minutes online. Apply for your EIN online now.
Who Needs an EIN? Understanding EIN Requirements
Knowing whether your business requires an EIN is a fundamental step. Generally, you’ll need to get an EIN if your business structure falls into any of the following categories:
- Employing Staff: If you hire employees, an EIN is mandatory. It’s needed to manage payroll, report employment taxes, and comply with labor laws.
- Operating as a Corporation or Partnership: Most corporations, S corporations, and partnerships are required to have an EIN, regardless of whether they have employees.
- Filing Specific Types of Taxes: If your business needs to pay excise taxes or taxes related to alcohol, tobacco, and firearms, you will need an EIN.
- Withholding Taxes for Non-Resident Aliens: If you pay income (other than wages) to non-resident aliens and are required to withhold taxes, an EIN is necessary.
- Certain Types of Organizations: Specific entities like trusts, estates, real estate mortgage investment conduits, non-profit organizations, and farmer’s cooperatives typically require an EIN to operate.
- Multi-Member LLCs: Limited Liability Companies (LLCs) with more than one member are generally required to obtain an EIN. Single-member LLCs may also need one depending on their circumstances (more on this below).
Even if you aren’t legally obliged to have an EIN for federal tax reasons, you might still want to get one. For instance, banks often require an EIN to open a business bank account, and some states may need it for state tax purposes. However, it’s important to note that EINs are specifically for business-related tax and operational activities and not for activities like state tax lien auctions or lotteries.
For a more detailed understanding, you can refer to IRS Publication 1635, “Understanding Your EIN” (PDF).
Before You Apply for an EIN: Essential Preparations
Before starting your EIN application, there are a couple of key steps to ensure a smooth process:
- Formalize Your Business Entity First: If you are setting up a formal legal entity such as an LLC, partnership, or corporation, it’s crucial to first register your entity with your state. This step should precede your EIN application. Tax-exempt organizations also need to be legally formed before applying. You can learn more about business structures here.
- Special Note for Tax-Exempt Organizations: Non-profits should only apply for an EIN after they have been legally established. It’s important to be aware that most tax-exempt organizations risk automatic revocation of their tax-exempt status if they fail to file required returns or notices for three consecutive years (more details here).
- Political Organizations’ Timeline: Political organizations have a very tight window. They must file Form 8871, Political Organization Notice of Section 527 Status within 24 hours of their creation and require an EIN to do so. Tax-exempt status is only granted after this filing.
How to Apply for an EIN: Multiple Convenient Methods
For businesses with their primary location in the United States, the IRS provides several convenient ways to apply for an EIN:
- Online Application: The Fastest Method: The IRS offers an online EIN application portal which is the quickest way to get your EIN. You can complete the application and receive your EIN immediately upon validation. This service is free and directly from the IRS. Start your online EIN application.
- Fax Application: You can complete Form SS-4, Application for Employer Identification Number and fax it to the IRS at 855-641-6935. If you choose this method, you can expect to receive your EIN within approximately four business days.
- Mail Application: Alternatively, you can mail Form SS-4 to the Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999. Processing times for mail applications are longer, typically around four weeks.
Applying for an EIN from Outside the U.S.
If your business’s principal location is outside of the United States, you have slightly different application methods:
- Phone Application: You can apply by phone by calling the IRS at 267-941-1099, Monday through Friday, from 6:00 a.m. to 11:00 p.m. Eastern Time.
- Fax or Mail using Form SS-4: You can also submit Form SS-4 by fax to 855-215-1627 (within the U.S.) or 304-707-9471 (outside the U.S.), or by mail to Internal Revenue Service, Attn: EIN International Operation, Cincinnati, OH 45999.
Important Application Limit: Regardless of the method you choose (online, phone, fax, or mail), you are limited to applying for only one EIN per day.
The Responsible Party: Defining Authority in Your EIN Application
When you apply for an EIN, you’ll need to designate a “responsible party.” This is the individual who ultimately controls, manages, or directs the applicant entity and the disposition of its funds and assets. The responsible party’s information is a critical part of the EIN application and generally includes:
- Full Name
- Taxpayer Identification Number: This can be a Social Security Number (SSN) for individuals, an Individual Taxpayer Identification Number (ITIN), or another EIN if the responsible party is itself an entity.
- Signature
It’s crucial to understand that nominees are not authorized to apply for an EIN. Using a nominee to apply for an EIN can expose your entity to significant risks regarding information and privacy. The IRS has specific guidelines on responsible parties and nominees for further clarification.
When Can You Use Your EIN? Immediate and Delayed Uses
Once you receive your EIN, you can start using it for most business operations almost immediately. Common immediate uses include:
- Opening a Business Bank Account: Banks typically require an EIN to open accounts for businesses.
- Applying for Business Licenses and Permits: Many federal, state, and local agencies require an EIN for various business licenses and permits.
- Filing Tax Returns by Mail: You’ll need your EIN to identify your business when filing paper tax returns.
However, there are certain processes that may take a bit longer to activate with your new EIN. Allow up to two weeks for:
- IRS Taxpayer ID Number (TIN) Matching Program Verification: This IRS system verifies the accuracy of TINs against IRS records.
- E-filing Tax Returns: The IRS systems need time to update with your new EIN before you can successfully e-file.
- Making Tax Deposits and Electronic Payments: For electronic tax payments and deposits, allow up to two weeks for your EIN to be fully recognized in the IRS systems. Refer to IRS Publication 15, Circular E, Employer’s Tax Guide and Publication 4275, EFTPS Express Enrollment for New Businesses (PDF) for more details on electronic tax payments.
What to Do While Waiting for Your EIN
If you have a tax deadline approaching and haven’t yet received your EIN, don’t panic. On your tax return, in the space for the EIN, write “Applied For” and the date you submitted your EIN application.
Similarly, if a tax deposit is due before you receive your EIN, send your payment to the designated IRS service center address for your state. Ensure your check or money order is payable to the Internal Revenue Service and includes your business name (as shown on Form SS-4), address, the type of tax, the tax period, and the date you applied for your EIN.
When Do You Need a New EIN? Ownership and Structure Changes
Generally, you will need to obtain a new EIN if there are significant changes to your business’s ownership or structure. This often includes situations such as:
- Changing to a different type of business entity (e.g., from a sole proprietorship to a corporation).
- Partnership changes that result in termination under the law.
- Corporations becoming subsidiaries or divisions of another corporation.
However, you generally do not need a new EIN simply to change your business name, business address, or responsible party. For detailed guidance, refer to the IRS guidelines on when to get a new EIN.
When You No Longer Require Your EIN: Deactivation, Not Cancellation
If you cease operating your business and no longer need your EIN, the IRS cannot technically “cancel” your EIN. However, they can deactivate it. Deactivating an EIN essentially flags it as no longer in use.
Recovering a Lost or Forgotten EIN
Misplacing or forgetting your EIN is a common concern. Here are several ways to try and locate your missing EIN:
- Check Your EIN Application Notice: The IRS issues a notice (e.g., CP 575) when your EIN application is approved. This notice will display your EIN.
- Contact Your Bank: If you have a business bank account, your bank likely has your EIN on record.
- Check State and Local License Applications: Agencies where you’ve applied for state or local business licenses may have your EIN.
- Review Past Tax Returns: Your EIN will be present on any previously filed business tax returns.
If these methods don’t help, you can call the IRS Business and Specialty Tax Line at 800-829-4933, Monday to Friday, 7:00 a.m. to 7:00 p.m. ET. After verifying your identity and authorization, the IRS may provide your EIN over the phone.
Managing Multiple EINs or Dealing with Unrequested EINs
It’s important to know that a business entity should generally have only one EIN. If you find yourself with multiple EINs and are unsure which one to use, contact the IRS Business and Specialty Tax Line at 800-829-4933 (TTY 800-829-4059) for guidance.
If you’ve taken over another business, remember to use your own EIN for reporting and depositing employment taxes, not the previous owner’s EIN. See IRS Publication 15, Circular E, Employer’s Tax Guide for more information on successor employers.
If you receive an EIN that you didn’t request, or suspect your EIN has been stolen, it’s crucial to take action. Learn what to do if you received an EIN you didn’t request or if you believe someone stole your EIN.
Reactivating a Deactivated Retirement Trust EIN
If you have a retirement trust EIN that has become deactivated, you can have it re-established. To do so, send the IRS the following information:
- The EIN in question
- The name of the trust
- The address and contact information for the sponsor or trustee
You can send this information via:
- Fax to 855-214-7520
- Mail to Internal Revenue Service, Attn. EP Entity, M/S 6273, Ogden, UT 84201
- Delivery to Internal Revenue Service, 1973 N Rulon White Blvd., Attn. EP Entity, M/S 6273, Ogden, UT 84404
Beneficial Ownership Information Reporting to FinCEN
Starting January 1, 2024, many companies are required to report information about their beneficial owners to the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury. This new requirement applies to certain corporations, LLCs, and similar entities created in or registered to do business in the United States. Beneficial owners are individuals who ultimately own or control the company.
The timing for initial beneficial ownership information reporting depends on when your company was created or registered. For detailed information on whether your company needs to report, who qualifies as a beneficial owner, and reporting deadlines, please visit FinCEN’s website.
For any questions about beneficial ownership information reporting requirements, please contact FinCEN directly. The IRS is unable to answer questions related to FinCEN requirements.
