What is an EIN?

An Employer Identification Number (EIN) is a nine-digit number assigned by the Internal Revenue Service (IRS) to businesses and other entities. It’s essentially a social security number for your business.  

Why do businesses need an EIN?

There are several reasons why businesses need an EIN:

• Tax Reporting: When filing federal taxes, you’ll need to use your EIN.
• Employee Taxes: If you have employees, you’ll need to withhold and pay federal, state, and local taxes using your EIN.
• Opening a Business Bank Account: Most banks require a business to have an EIN before opening a business bank account.
• Applying for Business Licenses and Permits: Many local and state government agencies require an EIN for business licensing and permits.

How to Apply for an EIN

There are three ways to apply for an EIN:

1. Online: This is the fastest and easiest way. You can apply through the IRS’s online application system.
   
    
2. By Mail: You can download Form SS-4, Application for Employer Identification Number, and submit it by mail to the IRS.
3. By Phone: Call the IRS Business Tax Line at 1-800-829-4933.

Common EIN Myths and Misconceptions

• You need an EIN to start a business: While an EIN is often necessary for business operations, you don’t need one to start a sole proprietorship.
• Your EIN is your business name: Your EIN is a unique identifier, not a business name.
• You can only have one EIN: Businesses can have multiple EINs, especially if they operate under different names or structures.