# Employer Identification Number (EIN): Who Needs It and How to Get It

![Employer Identification Number (EIN): A unique identifier assigned to a business entity so that it can easily be identified by the IRS.](https://www.investopedia.com/thmb/2Ly4VrxhH_xA8cJjJ8t4T6btCaI=/1500x0/filters:no_upscale():max_bytes(150000):strip_icc()/Employer-identification-number_final-cbdc6e7195014c9ca20ed4e9b6a6db64.png)

*— Investopedia / Michela Buttignol*

> **Definition**
>
> An employer identification number (EIN) is a unique number provided by the Internal Revenue Service used for tax filing, business reporting, and other uses where a company needs to be easily identified.

## What Is an Employer Identification Number (EIN)?

The term "employer identification number" (EIN) refers to a unique identifier that is assigned to a business entity. It's provided to a company by the [Internal Revenue Service (IRS)](https://www.investopedia.com/terms/i/irs.asp), and it is used to identify the company on specific types of documents such as tax filings. Businesses can apply for EINs directly with the IRS, which usually issues them immediately.  

### Key Takeaways

*   An employer identification number is a unique nine-digit number that is assigned to a business entity.
*   EINs allow the IRS to easily identify businesses for tax reporting purposes.
*   All businesses that meet certain criteria must have an EIN before they can begin operating.
*   Applying for one is free and applications are available on the IRS website.
*   Along with being needed for tax returns, EINs allow businesses to open bank accounts and apply for credit.

## Understanding the EIN

EINs are issued to identify business entities in the United States in the same way that [Social Security numbers (SSNs)](https://www.investopedia.com/terms/s/ssn.asp) are used to identify individuals. The EIN is also known as a Federal Tax Identification Number.

EINs are unique nine-digit numbers that are formatted as XX-XXXXXXX and, as noted above, are issued by the IRS. The agency uses them to identify [taxpayers](https://www.investopedia.com/terms/t/taxpayer.asp) who are required to file various business [tax returns](https://www.investopedia.com/terms/t/taxreturn.asp).

EINs are unique to the businesses to which they are assigned. They never expire, and the same number set is never reissued to another business, even if the original employer goes out of business.

Business entities must apply for an EIN before they can begin operations.

The types of businesses and other entities that are issued EINs include:

*   [Limited liability companies (LLCs)](https://www.investopedia.com/terms/l/llc.asp)
*   [Sole proprietorships](https://www.investopedia.com/terms/s/soleproprietorship.asp)
*   Non-profit organizations (NPOs)
*   Government agencies
*   Corporations
*   Personal service corporations
*   [S corporations](https://www.investopedia.com/terms/s/subchapters.asp)
*   Partnerships
*   Churches and church-controlled organizations
*   Plan administrators
*   Military entities
*   Government entities
*   Farmers' cooperatives
*   Indian tribal governments and enterprises
*   Real Estate Mortgage Investment Conduit (REMIC)
*   Estates
*   Trusts

The IRS is not biased toward the size of the company. This means that even those with only one employee are just as eligible for an EIN as [multinational corporations](https://www.investopedia.com/terms/m/multinationalcorporation.asp).  

> **Fast Fact**
>
> The EIN is not considered to be sensitive information the same way a Social Security number is and is freely distributed by businesses online and in print publications.

## Criteria for an EIN

A business or other entity needs an EIN if it:

*   Has any employees
*   Operates as a corporation or a partnership
*   Files employment, excise, or alcohol, tobacco, and firearms tax returns
*   Withhold taxes on income other than wages paid to non-resident aliens
*   Has a [Keogh plan](https://www.investopedia.com/terms/k/keoghplan.asp)
*   Is involved with a number of types of organizations including but not limited to trusts, estates, and non-profits

## How to Get an EIN

Applying for an EIN costs nothing and can be done by phone (for those who aren't in the U.S. but will do business in the country), fax, mail, or online. The process is fairly easy and uncomplicated.

Applicants must fill out Form SS-4: Application for Employer Identification Number, which is available on the IRS [website](https://www.irs.gov/pub/irs-pdf/fss4.pdf).

The IRS requires that the following information be included on the application: the name of the company's principal officer, grantor, general partner, [trustor](https://www.investopedia.com/terms/t/trustor.asp), owner, or any other title, along with their personal taxpayer identification number.

Other information that must be included on the form is:

*   The type of entity
*   The reasons for applying (new business, change of organization, IRS withholding requirement compliance)
*   The start or acquisition date
*   The principal [industry](https://www.investopedia.com/terms/i/industry.asp) of business

A business must be located in the U.S. or U.S. territories to apply for an EIN online. Once the online information is validated, an EIN is assigned immediately.

> **Important**
>
> The person responsible for the business, regardless of their title within the company, must be an individual and not an entity, unless it's a government entity.

## Benefits of an EIN

The main advantage of getting an EIN is being able to operate your business. You can't run it without it. You must apply for an EIN before you even get started.

With an EIN you can:

*   Hire and pay employees
*   Open bank [accounts](https://www.investopedia.com/terms/a/account.asp), obtain [credit](https://www.investopedia.com/terms/c/credit.asp), and invest surplus cash
*   Maintain corporate shields
*   File business taxes and register state taxes

Another benefit of an EIN is that it keeps your [personal finances](https://www.investopedia.com/personal-finance-4427760) separate from those of your business. This can be especially beneficial to self-employed individuals (such as [subcontractors](https://www.investopedia.com/terms/s/subcontracting.asp)) who must provide an identification number for tax reporting purposes to those who hire them.

While they aren't required to have an EIN, they can still get one and use it instead of their Social Security number.

This can protect their personal information from unscrupulous parties seeking their personal details for [identity theft](https://www.investopedia.com/terms/i/identitytheft.asp) and financial gain.  

> **Fast Fact**
>
> Businesses that change their ownership structure, e.g., sole proprietors who plan to incorporate, must apply for a new EIN.

## Closing Your EIN

Once you are assigned an EIN, it is forever associated with you and your company. The IRS officially can never cancel an EIN.

An EIN plays a critical part in required financial and tax reporting. Yet even if an entity never files a return, the EIN is still associated with it and can be used at a later time.

If you do receive an identification number but later decide the number is not needed, or if you close your business, the IRS can deactivate your associated business account.

This is often the case for [startup](https://www.investopedia.com/terms/s/startup.asp) companies that never launch. A letter indicating the legal name, business address, EIN number, EIN assignment notice (if available), and reason for the account closure must be mailed to the IRS.

The EIN will remain; only the IRS business account will be suspended.

## EIN vs. Taxpayer Identification Number (TIN)

A "[Tax Identification Number (TIN)](https://www.investopedia.com/terms/t/tax-indentification-number-tin.asp)" is a broad term used to describe any type of identification number.

It's a generic descriptor for an assortment of numbers that can be used on a tax form including but not limited to:

*   EIN
*   SSN
*   ITIN (Individual Taxpayer Identification Number)
*   ATIN (Taxpayer Identification Number for Pending U.S. Adoptions)
*   PTIN (Preparer Taxpayer Identification Number)

Depending on the particular taxpayer, the EIN may or may not be the TIN used by the IRS. For an employee, the TIN is usually their Social Security number.

For [corporations](https://www.investopedia.com/terms/c/corporation.asp), partnerships, trusts, and [estates](https://www.investopedia.com/terms/e/estate.asp), it's typically an EIN.

## What Happens If You Lose or Misplace Your EIN?

If you misplace notation of your EIN, look for it on the issuing notice sent to you by the IRS. If you can't find it, the financial institution where you do your day-to-day banking can provide it. You can also find it on your tax returns. If all else fails, contact the IRS' Business & Specialty Tax Line at 1-800-829-4933. Have identifying information on hand before you speak to an representative.

## Does My Business Need an EIN?

Most businesses need an employer identification number. Specifically, if yours has employees, is a corporation or partnership, files certain tax returns (employment, excise, or alcohol, tobacco, and firearms), withholds taxes on income other than wages paid to non-resident aliens, or has a Keogh plan, it needs an EIN.

## How Long Will It Take to Get an EIN?

When applying online, you can get an EIN immediately. It normally takes one week to get an EIN when applying by fax. If applying by mail, the turnaround time could be four to six weeks.

## The Bottom Line

An EIN is a unique nine-digit number that is assigned to a business entity by the IRS and must be obtained before it begins operating.

Most businesses will need an EIN to report taxes and for other financial purposes. To request an EIN, fill out Form SS-4, available on the IRS website.

> **Article Sources**
>
> 1.  Internal Revenue Service. "[If You No Longer Need Your EIN](https://www.irs.gov/businesses/small-businesses-self-employed/if-you-no-longer-need-your-ein)."
>     
> 2.  Internal Revenue Service. "[Form SS-4 Application for Employer Identification Number](https://www.irs.gov/pub/irs-pdf/fss4.pdf)."
>     
> 3.  Internal Revenue Service. "[Do You Need an EIN?](https://www.irs.gov/businesses/small-businesses-self-employed/do-you-need-an-ein)"
>     
> 4.  Internal Revenue Service. "[How to Apply for an EIN](https://www.irs.gov/businesses/small-businesses-self-employed/how-to-apply-for-an-ein)."
>     
> 5.  Internal Revenue Service. "[Get an Employer Identification Number](https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online)."
>     
> 6.  Internal Revenue Service. "[Do You Need a New EIN?](https://www.irs.gov/businesses/small-businesses-self-employed/do-you-need-a-new-ein)."
>     
> 7.  Internal Revenue Service. "[Taxpayer Identification Numbers (TIN)](https://www.irs.gov/tin/taxpayer-identification-numbers-tin)."
>     
> 8.  Internal Revenue Service. "[Lost or Misplaced Your EIN?](https://www.irs.gov/businesses/small-businesses-self-employed/lost-or-misplaced-your-ein)"
>     
> 9.  Blue Notary. "[How Long Will It Take to Get an EIN? Find Out the Timeline Here](https://bluenotary.us/how-long-will-it-take-to-get-an-ein/#:~:text=After%20sending%20the%20Form%20SS,mail%20speed%20and%20processing%20times.)."