Key takeaways
- An EIN is used when filing your business taxes.
- Sole proprietors and single-member LLCs without employees don’t have to get an EIN; all other business entities do.
- You can apply for a federal identification number for free at IRS.gov.
What is an EIN?
An employer identification number (EIN) is a unique, nine-digit tax identification number. It’s also known as a federal identification number. Think of it as a Social Security number for your business activities. You’ll use it when filing your business's income tax return or payroll tax return.
Not all businesses need an EIN, but there’s little downside in getting one. Applying is free and only takes a few minutes online at IRS.gov. An EIN also comes in handy to:
- Separate your business and personal finances.
Here’s what you need to know about getting an employer identification number.
Who needs to get an EIN?
Partnerships, corporations and multi-member LLCs must get an employer identification number to file their business income tax return.
If you have employees, you’ll also need an EIN to pay and file payroll taxes — even if your business is a sole proprietorship.
Certain types of organizational structures require EINs as well, including:
- Nonprofit organizations.
- Businesses that pay excise, alcohol, tobacco or firearm taxes.
- Businesses with a Keogh plan.
- Estates.
- Real estate mortgage investment conduits.
- Farmers' cooperatives.
- Plan administrators.
- Certain types of trusts.
If you’re a sole proprietor or single-member LLC with no employees, you have the option to use your Social Security number instead of an EIN when filing business taxes. But considering the benefits of getting an EIN, it’s a good idea to apply for one anyway.
How to apply for an employer identification number
The IRS lets you apply for an employer identification number online or by mail, fax or phone. Online is the easiest and fastest way to get an EIN, making it the best option if you’re eligible.
The application process is free, so be wary of companies that charge you to apply for an EIN on your behalf. And if you already have one but have lost track of it, look up your EIN before applying for another.
Follow these steps to get an EIN:
1. Make sure you’re eligible to get an EIN online
To get an employer identification number online, you’ll need to meet these requirements:
- Your principal business must be in the U.S. or U.S. territories. Your principal business is the main income-generating activity that you do.
- The person responsible for the business (e.g., the owner or a partner) must have a valid SSN or ITIN.
You can still get an EIN if you don’t meet those qualifications. However, you’ll need to apply via mail, fax or phone. International applicants who do not have a business presence or home in the U.S. yet must apply by phone.
2. Gather the necessary information
To complete the EIN application online, you’ll need to provide the following details:
- Your business entity type.
- Your full legal name and personal taxpayer identification number (SSN or ITIN).
- For LLCs, how many members your LLC has.
- The legal name of your business and state where the articles of incorporation were filed.
- Your business address.
- Primary reason for applying (e.g., launching a business, banking purposes, hiring employees).
- Date you started or acquired your business.
If you wish, you can name someone else to apply for an EIN on your behalf. To do so, you’ll need to complete the third party designee section of the EIN application form (SS-4). Be sure to keep a copy of the form for your records.
3. Submit your application and wait
If you apply online, you’ll receive your EIN immediately once you submit your application. Click here to start the process.
You’ll have to wait longer if you apply for an EIN by fax or mail. Fax applications take around four business days to process. Mailed applications may take up to four weeks.
Do you ever need to change your EIN?
You may need to apply for a new EIN if:
- Your business structure changes. For example, you'll need a new EIN if you are a sole proprietor and decide to incorporate or take on a partner in your business.
- You are subject to a bankruptcy proceeding.
- Your corporation merges with another one, creating a new entity.
If you’re changing the name of your business or opening a new location, you generally won’t need to reapply for an employer identification number.
What if you lose your EIN?
If you lose or misplace your EIN, there are a number of ways to look up your business tax ID:
- Find the computer-generated notice you received when you applied for an EIN.
- If you opened a bank account using the EIN, contact your bank to retrieve it.
- Find your EIN on a previously filed tax return.
Contact the IRS Business & Specialty Tax Line during business hours if you're unable to find your identification number through other methods.
