An Employer Identification Number (EIN) is a unique nine-digit number issued by the Internal Revenue Service (IRS) to identify businesses for tax purposes. If you plan to hire employees, open a business bank account, or file federal taxes, you’ll need an EIN. Here’s how to obtain one.
1. Who Needs an EIN?
Not all businesses require an EIN, but you must obtain one if you:
- Hire employees
- Operate as an LLC, Corporation, or Partnership
- File excise or employment taxes
- Open a business bank account
- Apply for business licenses and permits
Sole proprietors without employees can use their Social Security Number (SSN) instead. However, having an EIN can help separate personal and business finances.
2. How to Apply for an EIN
Applying for an EIN is free and can be done in several ways:
- Online – The fastest method is through the IRS website (irs.gov). You’ll receive your EIN immediately.
- By Mail – Complete Form SS-4 and mail it to the IRS. Processing takes about four weeks.
- By Fax – Send Form SS-4 to the IRS via fax. Processing usually takes four business days.
- By Phone (International Applicants Only) – Call the IRS at +1-267-941-1099.
3. Using Your EIN
Once issued, your EIN is used for:
- Filing business taxes
- Opening a bank account
- Applying for business loans and licenses
Final Thoughts
Obtaining an EIN is a simple but crucial step in running a business. Applying online is the fastest option, and having an EIN helps establish credibility and financial separation.