Employer Identification Number (EIN)

What is an Employer Identification Number?

An Employer Identification Number (EIN) is a nine-digit number assigned to businesses by the Internal Revenue Service (IRS) for tax purposes. EINs are assigned to sole ownerships, business owners with employees, corporations, partnerships, nonprofit elements, trusts, estates and government agencies.

More profound definition

Like a Social Security Number (SSN) or an Adoption Taxpayer Identification Number (ATIN) for people, the IRS relegates EINs to sort out tax payments. The number recognizes a company as an employer and permits the company to submit data about wages and pay rates paid out to employees.
Note that sole ownerships without employees are not required to have an EIN. On the off chance that a business has at least one employees, it must have an EIN. Businesses distinguish themselves with EINs on tax returns, business licenses, business permits, and an assortment of other government applications and forms. They likewise use it while opening a business bank accounts and taking out loans.

Illustration of an EIN

Doris is laying out a retail business. She plans to hire a couple of individuals to help her run the business. She realizes that she should send the IRS documentation of the income she pays these people as well as taxes throughout the year. She files for an EIN through the IRS website. She gets a nine-digit number that guarantees she can file this data accurately.

Features

• EINs permit the IRS to handily recognize businesses for tax reporting purposes.
• Along with tax reporting, EINs permit businesses to open bank accounts and apply for credit.
• All businesses that meet certain criteria must have an EIN before they can start operating.
• An employer identification number is a unique nine-digit number that is assigned to a business entity.
• Applying for one is free and applications are accessible on the IRS website.

FAQ

What Happens If You Lose or Misplace Your EIN?

Assuming you lose your EIN, search for it on the notice shipped off you by the IRS when your EIN was issued You can likewise try to recuperate it by reaching the financial institution where you do your everyday banking. You can likewise find it on your previous tax returns. When in doubt, contact the IRS' Business and Specialty Tax Line at 1-800-829-4933. Ensure you have any recognizing data close by before you address an operator.

How Long Will It Take to Get an EIN?

While applying online, you can get an EIN right away. An EIN application can be faxed to the IRS, however this mode of application might require as long as about fourteen days. The IRS likewise acknowledges paper mail applications, however it cites an expected turnaround time somewhere in the range of four and five weeks.

Does My Business Need an EIN?

Each business entity needs an employer identification number, including those that have employees, operate as corporations or partnerships, file certain tax returns (Employment, Excise, or Alcohol, Tobacco and Firearms), keep income taxes on income other than wages.

How Do I Find an Employer Identification Number?

You can find an employer identification number utilizing a tax return, applications for bank accounts or credit, on any state licenses or permits, or on forms used to report work done as an independent contractor or payments made by your business.