A Federal Tax ID Number Is a Nine-Digit Identifier the IRS Uses to Track Your Tax Obligations

A Federal Tax ID Number, also called an Employer Identification Number (EIN), is a nine-digit code the Internal Revenue Service assigns to businesses, nonprofits, trusts, and certain other entities. It works the same way a Social Security Number does for individuals — it's how the IRS tracks who owes taxes and who has filed returns.

If you are a sole proprietor with no employees, you can use your Social Security Number instead of getting an EIN. If you operate as a partnership, corporation, LLC, nonprofit, or have employees, the IRS requires you to have an EIN before you can legally operate or hire staff. The number is free to obtain and takes about 15 minutes to request online.

The format is always XX-XXXXXXX (two digits, hyphen, seven digits). You'll need this number on tax forms, business licenses, bank account applications, and when you file payroll taxes or business income tax returns.

Key Takeaways

  • An EIN is a nine-digit number issued free by the IRS to identify businesses, nonprofits, trusts, and other entities for tax purposes.
  • Sole proprietors without employees can use their Social Security Number instead, but most business structures require an EIN.
  • You can request an EIN online at IRS.gov in about 15 minutes and receive it immediately, or apply by mail or phone.
  • You will need your EIN to open a business bank account, hire employees, file business tax returns, and obtain most business licenses.

Who Needs to Get an EIN

The IRS requires an EIN if your business is structured as a partnership, S corporation, C corporation, or LLC. Nonprofits, trusts, and estates also need an EIN. If you are a sole proprietor — meaning you own the business by yourself and have no employees — you can file taxes using your Social Security Number, though many sole proprietors get an EIN anyway for privacy and business separation reasons.

If you hire any employees, even one part-time worker, you must have an EIN before their first day. The same applies if you operate a business that requires a state license, opens a business bank account, or files certain tax forms like payroll returns or excise tax returns.

How to Request an EIN Online, by Mail, or by Phone

The fastest way to get an EIN is to apply online at the IRS website (IRS.gov). Go to the EIN application page, answer questions about your business structure, location, and reason for needing the number, and you will receive your EIN immediately on screen. You can print the confirmation page right away. This method works if you have a valid Social Security Number or Individual Taxpayer Identification Number (ITIN).

If you prefer not to apply online, you can mail Form SS-4 (Application for Employer Identification Number) to the IRS address listed on the form. Processing by mail typically takes four weeks. You can also call the IRS Business and Specialty Tax Line at 1-800-829-4933 during business hours, though phone lines are often busy and wait times can be long.

You do not need to pay a fee for an EIN. The IRS issues it free of charge. Be cautious of websites or services that charge money to "help" you get an EIN — you can do this yourself at no cost.

What Information You Need to Provide

When you apply for an EIN, the IRS will ask for your business name, business address, mailing address, the type of business structure (sole proprietor, partnership, corporation, etc.), the reason you need an EIN (hiring employees, opening a bank account, filing a return, etc.), and the date your business began or will begin operations.

You will also need to provide the name and Social Security Number or ITIN of the person who owns or manages the business. If your business is a partnership or corporation, you may need to provide information about all owners. Have this information ready before you start the application to speed up the process.

When You Receive Your EIN and How to Use It

If you apply online, you receive your EIN immediately and can use it right away. If you apply by mail or phone, the IRS will send your EIN by mail within four weeks. Once you have it, write it down and keep it in a safe place — you will need it repeatedly.

Use your EIN when you open a business bank account, apply for business licenses or permits, hire employees, file tax returns, apply for business credit, and report payroll taxes. The IRS will also use your EIN to match tax documents you receive (like 1099 forms from contractors) to your business tax return.

EIN vs. Social Security Number for Tax Purposes

A sole proprietor can file business taxes using either an EIN or a Social Security Number. Using your Social Security Number is simpler if you have no employees and want to keep your business finances separate from your personal taxes on paper only. However, using an EIN provides more privacy — your Social Security Number does not appear on business documents, contracts, or vendor records.

If you plan to hire employees, apply for business credit, or operate as anything other than a sole proprietor, you must use an EIN. The IRS does not allow partnerships, corporations, or LLCs to use a Social Security Number for business tax purposes.

Frequently Asked Questions

Can I get an EIN if I don't have a Social Security Number?

Yes. If you are a non-U.S. citizen or resident, you can apply for an Individual Taxpayer Identification Number (ITIN) from the IRS and use that to request an EIN. You will need to file Form W-7 to get an ITIN first, which takes several weeks by mail.

How long does an EIN last?

An EIN does not expire. Once the IRS issues it to you, it remains valid for the life of your business. You do not need to renew it or reapply unless your business structure changes significantly (for example, if a sole proprietorship becomes an LLC).

What if I lose my EIN or forget the number?

You can look up your EIN by calling the IRS at 1-800-829-4933 or by checking any tax documents, bank statements, or business licenses you received after applying. The IRS can also mail you a copy of your EIN assignment letter if you request it.

Do I need an EIN if I'm starting a business but haven't hired anyone yet?

Not immediately. If you are a sole proprietor with no employees and no plans to hire, you can wait until you need one. However, if you plan to open a business bank account, file certain tax forms, or obtain a business license, you will need an EIN before you do those things.