A Federal Tax ID is a nine-digit number the IRS uses to identify a business or nonprofit for tax purposes

A Federal Tax ID, also called an Employer Identification Number (EIN), is a unique identifier issued by the Internal Revenue Service. The IRS assigns it to businesses, nonprofits, trusts, estates, and certain other entities so it can track tax filings and payments. If you operate a business or run a nonprofit, you will likely need one.

The number looks like this: XX-XXXXXXX (nine digits with a hyphen). It serves the same purpose for a business that a Social Security number serves for an individual — it is how the IRS knows who you are when you file taxes, hire employees, or open a business bank account.

You do not need a Federal Tax ID if you are a sole proprietor with no employees and you do not file certain types of tax returns. In that case, you can use your Social Security number instead. But if you hire staff, form an LLC or corporation, or run a nonprofit, you will need one.

Key Takeaways

  • A Federal Tax ID is a nine-digit number issued by the IRS to identify businesses, nonprofits, and other entities for tax purposes.
  • You need one if you have employees, operate as an LLC or corporation, run a nonprofit, or file certain tax forms like partnership returns.
  • Sole proprietors with no employees can use their Social Security number instead, unless they choose to get an EIN.
  • You can request one free from the IRS by phone, mail, fax, or online, and you typically receive it the same day if you apply online.
  • Once issued, a Federal Tax ID does not expire and remains yours for the life of the business.

Who needs a Federal Tax ID

The IRS requires a Federal Tax ID for most business structures. If you operate as a corporation, S corporation, partnership, or limited liability company (LLC), you must have one. If you run a nonprofit organization, you need one to file Form 990 and to receive tax-exempt status. If you hire employees — even one part-time worker — you need one to report payroll taxes and file employment tax returns.

You also need a Federal Tax ID if you operate a sole proprietorship but file certain tax forms, such as Form 1065 (partnership return) or Form 1120 (corporate return). Some sole proprietors without employees choose to get one anyway, even though they are not required to, because it keeps their Social Security number private on business documents and bank accounts.

Trusts and estates need Federal Tax IDs if they have income or file a return. Certain nonprofits, such as churches, may be exempt from the requirement in some cases, but most nonprofits that want tax-exempt status must have one.

How to request a Federal Tax ID from the IRS

You can request a Federal Tax ID free from the IRS using four methods: online, by phone, by mail, or by fax. The fastest route is the online application at irs.gov. You fill out Form SS-4 (Application for Employer Identification Number) on the IRS website, and you receive your number immediately upon completion.

If you call the IRS Business and Specialty Tax Line at 1-800-829-4933, you can complete Form SS-4 over the phone and receive your number the same day. The line is open Monday through Friday, 7 a.m. to 10 p.m. Eastern time.

You can also mail or fax a completed Form SS-4 to the IRS. Mail typically takes two to four weeks. Fax is faster — usually one to two weeks — but you must send it to the correct fax number for your region, which you can find on the form itself or on irs.gov.

No matter which method you use, you will need basic information about your business: the legal name, the physical address, the type of business structure, the date you started or plan to start, and the name and Social Security number of the owner or responsible party.

What information you need to provide

When you request a Federal Tax ID, the IRS asks for details about you and your business. You will need the legal name of your business exactly as it appears on your formation documents (articles of incorporation, LLC operating agreement, or partnership agreement). You will also need the physical street address where the business operates — a mailing address alone is not enough.

You must provide the business structure type: sole proprietorship, partnership, corporation, S corporation, LLC, nonprofit, trust, or estate. You will need the date the business started or the date you plan to start. If you have a responsible party — such as a managing member of an LLC or a partner — you will need their name and Social Security number.

If you are hiring employees, you will need to tell the IRS the expected date of your first payroll and the number of employees you plan to hire. This information helps the IRS route your return to the correct processing center.

What happens after you receive your Federal Tax ID

Once the IRS issues your Federal Tax ID, it is yours for the life of the business. The number does not expire. You use it on all tax returns, payroll forms, and business bank accounts. You will receive a confirmation letter from the IRS (Form SS-4 confirmation) that shows your new number.

Keep this letter in a safe place. You will need to reference your Federal Tax ID when you file income tax returns, employment tax returns (if you have employees), and any other forms the IRS requires. You will also need it when you open a business bank account, apply for business licenses, or register with state tax agencies.

If you lose track of your Federal Tax ID, you can look it up on irs.gov or call the IRS at 1-800-829-4933. The IRS can tell you the number if you provide your business name and address.

Federal Tax ID versus Social Security number for business

A sole proprietor without employees can choose to use either a Federal Tax ID or a Social Security number on tax returns and business documents. Both work for filing taxes. The main difference is privacy and separation of personal and business identity.

Using a Federal Tax ID keeps your Social Security number off business bank accounts, invoices, and vendor forms. This reduces the risk of identity theft and keeps your personal finances more separate from your business finances. Many sole proprietors get a Federal Tax ID for this reason alone, even though they are not required to.

If you use your Social Security number and later hire an employee or change your business structure, you will need to get a Federal Tax ID at that point. You cannot switch back to using your Social Security number once you have employees.

Frequently Asked Questions

How long does it take to get a Federal Tax ID?

Online applications are processed immediately, and you receive your number the same day. Phone applications also result in same-day issuance. Mail takes two to four weeks, and fax takes one to two weeks. If you need the number quickly, apply online or call the IRS.

Can I get a Federal Tax ID if my business is not yet open?

Yes. You can request one before you officially start operations. On Form SS-4, you will provide the date you plan to start the business. The IRS will issue the number regardless of whether you are currently operating.

Do I need a Federal Tax ID if I am a sole proprietor with no employees?

No, you can use your Social Security number instead. However, many sole proprietors get one anyway to keep their Social Security number private on business documents and bank accounts.

What if I already have a Federal Tax ID and need to change my business name?

You do not need a new Federal Tax ID if you change your business name. The number stays the same. You simply notify the IRS of the name change by filing Form 8822-B (Change of Address). Your existing Federal Tax ID continues to work.

Can I have more than one Federal Tax ID?

Each separate business entity needs its own Federal Tax ID. If you own multiple businesses with different structures or ownership, each one gets its own number. You cannot reuse a Federal Tax ID for a different business.