An EIN number (Employer Identification Number) is a 9-digit tax identification number small businesses, and other entities, use to file employment, excise, or alcohol/tobacco/firearms tax returns and file reports. The number—also called a FEIN (Federal Employer Identification Number)— establishes your business tax account.
You need to get an EIN number if you pay employees, operate your business as a corporation, limited liability company or partnership, withhold taxes when paying a non-resident alien, or you have a Keogh Plan (tax-deferred pension plan). Furthermore, certain trusts, estates, farmers' coops, plan administrators, non-profit, and other types of organizations are required to have an EIN.
We've prepared this helpful guide about how to get an EIN to help you in the process.
How to Get an EIN: Meet these Eligibilities
Even though applying for an EIN number is straightforward and easy to complete online, you must meet these requirements first.
- Your principal business must be located in the United States or US Territories
- The applicant must have a valid taxpayer identification number (SSN, ITIN)
- The responsible party (the person who owns or controls the entity) can only apply for one EIN per day
Is there a fee for applying for an EIN?
At no time will the IRS ask you to pay a fee.
How to Get an EIN Online
Use these instructions when using the online EIN assistant. Because the IRS requires different information depending on which legal structure you select, it's imperative for applicants to complete all blanks and answer all questions. Independent contractors, small business owners, and other types of organizations all use the same application.
Use this IRS link to fill out the application. This service is available Monday through Friday from 7:00 a.m. to 10:00 p.m., ET.
1. Choose your business structure or entity
- Sole Proprietor
- Limited Liability Company (LLC)
- Other types of organizations
2. Answer the questions
As you fill in the blanks, questions will be asked based on the business structure you chose.
IMPORTANT NOTE: Please keep in mind that the questions you will see depend on your business structure, and other questions may be asked that aren't listed here.
- The legal name of the individual or entity
- Trade name (if it's different from legal name)
- Title, if any (such as executor, administrator, trustee)
- Mailing address
- Street address (cannot be a post office box)
- County and State where the business is located
- Name of the responsible party (the person who owns or controls the entity)
- SSN, ITIN, or EIN of the responsible party (the name and SSN/ITIN/EIN must match IRS records, or the application cannot be processed
- If the application is for a Limited Liability Company (LLC), applicants must enter the total number of LLC members
- If the application is for a Corporation, applicants must enter the State where incorporated
- Your reason for applying
- Month, day, and year the business was started or acquired
- The closing month of your accounting year
- The highest number of employees expected in the next 12 months (enter 0 if none)
- Those with employment tax liability less than $1,000 in a calendar year can check to file form 944. If you don't make that selection, you must file form 941 each quarter
- First date wages or annuities were paid
- Specify the principal activity of your business
- Indicate the principal line of products or services sold
- Indicate whether the entity or individual shown on the application has ever applied and received an EIN. If you have, you must enter that EIN.
- You can assign a third-party designee to receive the entity's EIN and include their phone and fax number
- You can provide an email address to receive your EIN confirmation letter or request to have it mailed
After completing the application, make sure to review all the information and correct any errors
Click the submit button to send the application to the IRS. It's that easy!
Remember that the IRS guarantees that "applications are processed, and EINs are delivered to you the same day, and usually within hours." If you submit your application past 9:00 p.m. ET, the EIN will be delivered to you on the next business day. The IRS recommends that you install Adobe Reader to receive the confirmation letter online.
Once you receive the confirmation letter, it's a good idea to keep a physical copy in your files and a digital copy in a business organizer or email folder.
How to Get an EIN: Application Tips
When completing the application online, applicants must do so in one session. You can't save the application and return later to complete it. If you're inactive for more than 15 minutes, the system requires that you start over. We suggest that you print out a copy of the SS-4 application and get familiar with what the IRS needs. Please also note that depending on your business structure, the online EIN assistant asks other questions that aren't listed on the SS-4 application.
The quickest and easiest way to get an EIN number is to use the online EIN assistant. However, you can fill out an SS-4 application and fax or mail it to the appropriate number and/or address. This usually takes up to four business days to process a faxed copy and four weeks for applications received by mail.
While some services charge $75 or more to submit your EIN application and may request $300 for rush delivery, the IRS provides EINs at no charge.
What if You're a Sole Proprietor? Do You Need an EIN?
If you're a sole proprietor, you don't necessarily need an EIN. Many sole proprietors use their SSN instead of an Employer Identification Number.
However, you can get an EIN if you want. The most common reasons why sole proprietors apply for an EIN are:
- Using an SSN to do business might be risky, as business owners might suffer identity theft: thieves might file fraudulent tax returns or steal their refunds. Using an EIN can safeguard you against it.
- Sole proprietors using an SSN might give the appearance that they are mere employees. On the other hand, an EIN could be considered more professional and could help strengthen the impression of being an independent contractor or business owner.
- Some grant and loan applications require an EIN, so many sole proprietorships apply for an EIN to be able to receive stimulus from the government or financial institutions.
How to get an EIN as a sole proprietor? You can follow the same instructions listed above.
If you ever change your business structure, you must obtain a new EIN.
Getting an EIN isn't Hard
By knowing whether you're eligible before applying for an EIN number and providing accurate information on the application, you should receive the number quickly.
Once the IRS issues the number, you can apply for a business banking account, credit card, or loan and submit tax payments and returns. An EIN keeps your business matters separate from your personal finances. Moreover, the number ensures that you stay compliant with regulatory agencies by keeping your finances and legal matters in top-notch shape.
If you already have your EIN, but you have misplaced it, you don't need to do this whole process again. This article may be helpful:
How to Verify Your EIN Number