Editorial · October 15, 2016
EIN Application: How to Get a Tax ID for Your Business
An EIN application is how a business gets its tax ID from the IRS. An Employer Identification Number is a nine-digit number the IRS uses to track a business for tax purposes. The application is free, and you can finish it online in one sitting.
Who needs an EIN
The IRS gives a short quiz for this. You need an EIN if you answer yes to any of these questions. Do you have employees? Do you run your business as a corporation or a partnership? Do you file employment, excise, or alcohol, tobacco and firearms tax returns? Do you withhold tax on income, other than wages, paid to a non-resident alien? Do you have a Keogh plan?
You also need one for certain kinds of groups. These include trusts (with some exceptions), estates, non-profit organizations, farmers' cooperatives and plan administrators. A sole owner with no staff and no such filings may not need an EIN.
The free way to apply online
The IRS calls the online form the preferred method. You fill it in, the IRS checks it during your session, and the EIN is issued right away. You can then download, save and print your confirmation notice.
You can use the online form if your business is in the United States or a U.S. territory. The person who applies must have a valid taxpayer ID of their own, such as a Social Security number, an ITIN or another EIN. The service runs Monday through Friday, 7 a.m. to 10 p.m. Eastern Time. The IRS planned to take it offline on October 10, 2016 for maintenance, so check that it is running before you plan your day.
Fax, mail and phone options
You can also use Form SS-4, the Application for Employer Identification Number. Fill in every required item first. If you fax it and include your fax number, the IRS faxes the EIN back within four business days. If you mail it, expect about four weeks.
Applicants outside the United States can call the IRS at 267-941-1099. It is not a toll-free number. It runs Monday through Friday, 6 a.m. to 11 p.m. Eastern Time. The caller must be someone who is allowed to receive the EIN and answer questions about the form.
Rules to know before you start
Applying is free. The IRS warns that some websites charge for this free service, so use the IRS site. Go to irs.gov and look for the EIN pages.
The online form has no save option. You must finish in one session, and it ends after 15 minutes of no activity. Gather your details before you open it. The IRS also limits issuance to one EIN per responsible party per day, whether you apply online, by fax or by mail.
If the person responsible for the business is an entity that already got its EIN online, the online form cannot process the request. In that case, use the fax or mail route.
Why the number matters
If you hire workers, the EIN is how you report and pay employment taxes. The IRS explains employer tax duties in Publication 15, the Employer's Tax Guide. Publication 15-A covers more complex questions, and Publication 15-B covers the tax treatment of employee benefits. You can download them from IRS.gov.
Do not use an EIN to take part in other activities. The IRS says EINs are issued for tax administration only, and not for things like tax lien sales or lotteries.
If you run a tax-exempt group, form it legally before you apply. When you apply for an EIN, the IRS presumes the group is legally formed, and a three-year clock for annual filings can start. Missing three straight years of required filings can cost a group its exempt status.
If you lose your EIN
Do not apply for a second number. The IRS has a page called Lost or Misplaced Your EIN for owners who cannot find theirs. People who receive home-care services and already have an EIN, as a sole proprietor or household employer, should keep using it.
Once you have the number, keep the confirmation notice with your business records. You will need the EIN again for tax returns, for payroll and, in many cases, when you open a business bank account.