What is an Employer Identification Number (EIN) & do I need one for my new business?
An EIN (aka Federal Tax ID) is required by the IRS for certain businesses.
EINEmployer Identification Number
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EIN’s are to businesses what Social Security numbers are to individuals, unique identifiers for taxation and government record keeping purposes.
If your business pays taxes, has employees, uses a business bank account, or deals with third-party vendors then you need an EIN.
An EIN is not required in all cases, such as for Sole Proprietors, but even in these cases it’s advised to apply for an EIN.
You will have to use something for tax identification, and often vendors will require a tax ID as well – the last thing you want to do is use your Social Security number.
Using your Social Security number exposes you to identity theft risks, and it also makes it more difficult to claim limited liability protection for your personal assets should the need arise.
Getting an EIN is quick and easy, and doing it early will save you a lot of pain in the future.
Common EIN (Federal Tax ID) Questions
If you plan to form an LLC, S-Corp, C-Corp, Nonprofit or Limited Partnership then yes – you need to have everything organized with the state prior to filing.
To complete the EIN application you will need the name of your business as it is registered with the Secretary of State, as well as the formation date.
Absolutely. You can apply directly with the IRS and receive your EIN for free.
There is some nuance to the application form which can often times confuse filers. If you just want a professional service to handle it for you, we offer that option.
Free Business Name Search
This is a complimentary free name search, we’ll respond via email with any findings. This doesn’t initiate or replace a corporate filing order.
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