WHAT IS Employer Identification Number?
EIN is the acronym for Employer Identification Number. It is a nine-digit number, assigned to businesses by the Internal Revenue Service to identify that particular business. It is the social security number for your business if you will. With one difference though: Your SSN is your private information, whereas EIN is public information.
WHY DO YOU NEED TO FIND YOUR EIN?
Putting this question in a different way, why would you need an EIN? EIN is your business identification, which will be useful in different places, such as:
- To file business taxes
- To apply for a loan or credit for your business
- To open a small business bank account
- To hire employees (this is a must-have reason to obtain an EIN)
WHY IS HAVING AN EIN IMPORTANT?
Some businesses, which don’t hire employees may not be required to have an EIN but if your business, all of a sudden, finds itself in the need of having one, it is better to be prepared. Hence, businesses are encouraged to have an EIN.
HOW DO I KNOW IF MY BUSINESS NEEDS AN EIN?
If you want to know you should have an EIN today or not, answer the following questions, regarding your business:
- Does your business have employees or planning to hire some in the future?
- Is your business operating as a partnership or corporation?
- Does your business file employment, excise, or alcohol, tobacco, and firearms tax returns?
- Does your business withhold taxes on income?
- Do you have a Keogh plan?
- Is your business involved with:
** Income Tax Returns
** Real Estate Mortgage Investment
** Non-profit organizations
** Farmers’ cooperatives
** Plan administrators
If you have answered yes to any of these questions, yes your business needs an EIN.
WHEN DOES MY BUSINESS NEEDS A NEW EIN?
If your business is a sole proprietorship, you will need a new EIN when:
- You incorporate.
- You take partners and become a partnership
- You purchase or take over an existing business and operate as a sole proprietor
- You went into a bankruptcy proceeding.
If your business is a sole partnership, you will need a new EIN when
- You incorporate.
- Your partnership is taken over by one of the partners and turns to a sole proprietorship
- Your old partnership ends and a new one begins.
There are several different methods to apply for a new EIN for your business.
- Method 1: Online application
The easiest and fastest way to get your EIN is by going through the EIN assistant on the IRS website. If you click this link, then you will need to click the “Begin Application” button. Then follow the instructions and fill out the necessary information.
Please keep in mind that, before you are able to apply for an EIN, you must formally establish your business and have a legally recognized business name, as this will be the first piece of information, which will be asked from you and the date of business formation. Before getting the EIN, you should register your business name with your state and get the state’s approval.
- Method 2: Application via fax
Even though the concept of faxing may sound archaic, it still has legitimate business uses and this is one of them. IRS accepts applications over the fax. In order to request your free EIN by fax, you need to go to the IRS Website and download the Form SS-4. After filling out this form, you should fax it to (855) 641-6935. If you have no principal place of business, no legal residence, or no principal office or agency in any state, fax your form to (855) 215-1627, if you are faxing from within the US, or, (304) 707-9471, if you are faxing from outside the US.
- Method 3:Application via mail
It is the slowest method among all of them but it still is an option. The form SS-4 needs to be downloaded or obtained from an IRS branch office, filled out, and needs to be sent to:Internal Revenue Service
Attn: EIN International Operation
Cincinnati, OH 45999
- Method 4:Application via phone for international applicants
Those who are living outside the US can call (267) 941-1099 (please note this is not a toll-free number) between 6 AM and 11 PM US Eastern Standard or Daylight Time. At the time of call, the caller must be ready to give the information that is asked on form SS-4 and be authorized to receive the EIN number.
Depending on the company and the reason why you need to find its EIN, it might be an easy task, sometimes as easy as looking at your W-2.
- Public CompaniesYou can find the EIN of a publicly-traded company through SEC’s Electronic Data Gathering Analysis and Retrieval (EDGAR) database You just need to type the company name, and click on “Search.”
Among the search results, you should locate the correct company, if there is more than one company matching the name search and look through its documents filed with SEC, for a Form 10-Q or Form 10-K. In these forms, you will be able to find out the company’s EIN.
- Nonprofit organizationsTo find a nonprofit organization’s EIN, you need to check the Guidestar Website, type the name of the nonprofit organization you are looking for and click on the search button. Once the search results get loaded, find the organization you want to search for and their EIN should be right under their name. You can also click on the name of the nonprofit organization to get more information about them.
- Private companiesUnlike public companies and nonprofit organizations, there is no centralized database to look up the privately-owned companies. To find the EIN of one such company, one has to look for an employee of this company and procure a copy of their W-2 form. In the box B on this W-2 form, EIN is located right under the company’s name and address. One caveat though, if the company has a different EIN due to any of the reasons mentioned previously, the accuracy of this result can not be trusted. But usually, company owners do not change EIN, just for the fun of it.
- Other methods to determine a business’ EINIf you tried all possible ways to find the EIN of a company but failed, there are other ways to find it, such as:
* Contact the IRS directly. If you are an authorized representative of this company and want to learn the EIN. The IRS customer service agent will ask you your name, social security number, and some other pertinent information. Once this information is verified you will be provided the EIN over the phone.
* Contact the company. Although the company has no legal obligation to give you this information, since it is kind of a piece of public information, most of the time, they will tell it to you.
* Use a paid search engine. Likes of Lexis Nexis or Bloomberg law can provide you the EIN of any legal entity for a nominal fee.
FREQUENTLY ASKED QUESTIONS ABOUT EMPLOYER IDENTIFICATION NUMBER (EIN)?
- Is an employer identification number (EIN) the same as a taxpayer identification number (TIN)?
Even though the names might not be the same, the EIN and Taxpayer Identification Number, a.k.a. TIN are the same nine-digit number for the same employer
- Which events require the employer to obtain a new EIN?
If your business already has an EIN, and the business entity or ownership of this business changes, you will need to apply for a new EIN.Some of the most common circumstances, which requires a new EIN include but may not be limited to the following:
* An existing business changed hands and now owned by an individual who will run it as a sole proprietor.
* A sole proprietorship changes to a corporation
* A sole proprietorship changes to a partnership.
* A sole proprietorship files for bankruptcy under Chapter 7 or Chapter 11 (liquidation or reorganization respectively).
* A sole proprietorship establishes a pension, profit-sharing, retirement plan, etc..
* A partnership changes to a corporation.
* A corporation changes to a partnership.
* An individual who is the sole proprietor of a business dies and his or her estate takes over the business.
- Do self-employed people need an EIN?
Self-employed people do not necessarily need an EIN since they can operate using their own social security numbers where necessary, but it is always advisable to obtain a free EIN. Separating personal and business lives, financially speaking, is always beneficial. It reduces the risk of identity theft because of using EIN instead of SSN where asked. This reduces the exposure of one’s own SSN, minimizing the exposed target area to the miscreants of the internet.
Also, having a separate business line of credit can prove to be beneficial under certain circumstances.
- Are EIN and FEIN the same thing?
FEIN stands for Federal Employer Identification Number and it is the same thing as Employer Identification Number (EIN)
- What is the difference between DUNS and EIN numbers?
Both numbers are nine digits, used to identify a particular business entity but their similarity pretty much stops there. EIN is assigned to a company by a federal government authority, namely IRS, whereas, DUNS number is issued by a private company, namely Dun & Bradstreet> DUNS number is useful for establishing a business credit more than anything else but this company also keeps other pieces of information about the company. While EIN is public knowledge, the DUNS number belongs to a private company.
- How can I recover my EIN in case it gets lost?
Your EIN was sent to you via an email or postal mail, depending on the way you applied for it. Since it is considered to be an important piece of a business document, you should have kept it safe, somewhere you can reach when it is needed. But in case it was lost, damaged and you have no access to it, you can always call the taxpayer department hotline of the IRS at (800) 829-4933 from Monday to Friday, between the hours of 7:00 AM and 7:00 PM Eastern Time Zone.
- If you need to cancel your EIN check out our guide.