What is an EIN?
If you’re about to launch a new business or are taking the next step toward becoming “official”, there is a good chance you will need an Employer Identification Number (“EIN”). This is the number that tells the IRS your business exists.
An EIN is a unique nine-digit number issued by the IRS to identify your business for tax purposes. Think of it as akin to a Social Security Number. Your SSN is your personal identifier whereas the EIN is your business identifier.
Who needs an EIN?
- LLCs, corporations, and partnerships
- Nonprofits
- Sole proprietors who hire employees or want to keep personal and business finances separate
Why It Matters
An EIN prepares your business to conduct the following activities:
- Open a business bank account
- Legally hire employees
- File business taxes and payroll reports
- Apply for business licenses or loans
An EIN brings your business to the next level. It signals to clients and vendors that you’re serious about your operations and you’ve properly and legally organized. It reassures everyone who deals with your business that you’re accountable and tax compliant.
Even if you haven’t hired your first employee yet, an EIN gives your business a professional identity and keeps your personal SSN private.
It’s Fast and Easy (Usually)
It only takes a few minutes to apply online through the website. You’ll receive your EIN immediately after completing the application.
The service is available Monday–Friday, 7 a.m.–10 p.m. EST
Just follow the instructions at: https://sa.www4.irs.gov/applyein/
Sometimes it is not possible to use the online portal (typically because of a name conflict). In that case, you can also apply by mail or fax:
Download Form SS-4 https://www.irs.gov/pub/irs-pdf/fss4.pdf and send it to:
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
Or fax to: (855) 641-6935
Processing time is supposed to be a few business days, but typically is 4 weeks (sometimes much more). It is much better to use the online process if possible.
For Businesses Outside the United States:
Apply by phone at: (267) 941-1099 between 6 a.m.–11 p.m. EST (not toll-free)
Important Information You’ll Need When Applying
- Legal name and formation details of your business
- Business address and phone number
- Type of entity (LLC, corporation, etc.)
- Name and SSN of the responsible party
Final Thought
Obtaining your EIN is one of the easiest ways to separate you from your business. Once you’ve got it, you can move confidently into banking, hiring, and tax filing all with your legal foundation solidly set.