Employer Identification Number

A unique identifier assigned to businesses by the IRS

An Employer Identification Number (EIN), also known as a Federal Tax Identification Number, is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to business entities operating in the United States for the purposes of identification. The EIN is used by the IRS to identify taxpayers that are required to file various business tax returns.

Purpose and Use

The primary purpose of an EIN is to identify a business entity for tax purposes. It is used by employers, sole proprietors, corporations, partnerships, non-profit organizations, trusts, estates, government agencies, certain individuals, and other business entities. An EIN is required for:

• Filing business tax returns
• Opening a business bank account
• Applying for business licenses
• Hiring employees
• Establishing a credit profile for the business

How to Obtain an EIN

Businesses can apply for an EIN through the IRS. The application process can be completed online, by fax, or by mail. The online application is the fastest method, and the EIN is issued immediately upon completion. The application requires basic information about the business, such as the legal name, address, and type of entity.

Format

The EIN is formatted as a nine-digit number, typically written as XX-XXXXXXX. The first two digits are known as the "prefix" and were originally assigned based on the geographical location of the business. However, since 2001, the prefix is assigned based on the method of application rather than the location.

Differences from Other Identifiers

An EIN is distinct from a Social Security Number (SSN), which is used to identify individuals, and a Taxpayer Identification Number (TIN), which can refer to either an SSN or an EIN. Unlike an SSN, an EIN is used exclusively for business entities.

Also see

• Internal Revenue Service
• Social Security Number
• Taxpayer Identification Number
• Business entity
• Taxation in the United States