As an entrepreneur, obtaining an Employer Identification Number (EIN) is an important step in bringing your business to life. This number establishes your business as a tax-recognized entity for federal tax purposes, allowing you to perform essential activities like filing taxes and hiring employees.
In this guide, we’ll outline the steps for obtaining an EIN and how to update or correct your official EIN record.
Who needs an EIN?
An EIN is a nine-digit federal tax identification number assigned by the Internal Revenue Service (IRS) for tax purposes. You can think of an EIN as being the business equivalent of an individual’s Social Security Number (SSN).
Generally speaking, you will need an EIN if your business falls into one or more of the following categories:
- Your business is a partnership, limited liability company (LLC), corporation, or tax-exempt organization.
- You have or plan to have employees, meaning you’ll need to pay or withhold employment taxes.
- You need to open a business bank account. (This is a common requirement at many financial institutions.)
Note that an EIN is not the same as a state tax ID, which is used for state-level taxes and required by many states. It also does not replace the step of registering your business, which is necessary in most cases.
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The IRS issues EINs free of charge; be cautious of third-party websites that charge a fee to obtain an EIN on your behalf. The EIN process is also relatively fast and straightforward:
Step 1: Determine your eligibility
Before filing for an EIN, make sure you meet the following eligibility requirements:
- Your business is physically located within the United States or its territories. (International entities that conduct business in the United States can still apply, though they are ineligible to do so online.)
- You’ve named a responsible party, or the individual responsible for controlling, managing, or directing the business, its funds, and its assets.
- The responsible party has a valid SSN, Individual Taxpayer Identification Number (ITIN), or separate existing EIN.
Note that an EIN is not the same as a state tax ID, which is used for state-level taxes and required by many (though not all) states.
Step 2: Prepare to apply
Once you’ve established your eligibility for an EIN, you’ll need to gather pertinent business details for your application:
- The complete legal name of your business, including any trade names or doing business as (DBA) names.
- Your business’s mailing address and physical address.
- Your business entity type (e.g., LLC, corporation) and your reason for applying for an EIN.
- Operational details, including your business’s primary activities and the anticipated number of employees in the first year.
Step 3: Apply via your preferred method
The IRS offers four ways to file for an EIN: online, by fax, by mail, or by phone. Regardless of method, you can only apply for one EIN per responsible party per day.
Online
In most cases, the online application is the simplest and fastest method, and is recommended by the IRS. Here’s how to do it:
- Go to the “Get an employer identification number” section of the IRS website, then press the “Apply for an EIN” button to go to the application page.
- Press the “Begin Application Now” button at the bottom of the page. Keep in mind that you must complete the application in a single session, and it will time out after 15 minutes of inactivity.
- Select your business’s legal structure and whether you are the business owner or a third-party designee. From there, you’ll be asked to fill in details based on your structure, such as partner information for partnerships, or the number of members for an LLC.
- Fill in your business’s legal name (including trade name or DBA, if applicable), its physical address, and county and state of operation.
- Share your reason for applying for an EIN, such as starting a new business, hiring employees, or restructuring an existing company.
- Select the category that best describes your business’s principal activities.
- Double-check your information, then submit your application to receive your EIN immediately.
The online application service is available Monday through Friday, 6:00 a.m. – 1:00 a.m. (the next day), Saturday, 6:00 a.m. – 9:00 p.m., and Sunday, 6:00 p.m. – 12:00 a.m. (Eastern time).
Fax or mail
If you prefer not to apply for your EIN online, you can also file Form SS-4 via fax or mail. This form includes the same information as the online application, including your legal structure, responsible party, legal name(s), and address, reason for filing, and principal activities.
After you review your application for accuracy, you can submit it via:
- Fax to 855-641-6935. You’ll receive a cover sheet with your EIN within four business days.
- Mail to Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999. You’ll receive your EIN via mail in four to five weeks.
Phone
International applicants who cannot file online or by fax/mail can apply for their EIN via phone at 267-941-1099. Phone service is available Monday through Friday, between 6:00 a.m. and 11:00 p.m. Eastern Time. You will be asked to provide the same business details as in the other application methods. Once your information is confirmed, the IRS will issue your EIN over the phone.
Step 4: Receive your CP-575 Letter
After your application is processed and approved, you’ll receive a CP-575 letter from the IRS, which confirms that you’ve been issued an EIN. It includes the following details:
- Your nine-digit EIN.
- Your business’s name and official filing address.
- The federal tax forms you will need to file.
Your CP-575 notice is a crucial document because it serves as official proof of your EIN. You may be asked to provide this letter when applying for a business banking account, setting up payroll, or communicating with certain government entities.
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How do I update or correct my EIN record?
The process for updating your EIN record will depend on the information that needs to change:
- If your business’s mailing address, business location, or responsible party has changed since your initial EIN application, you will need to fill out Form 8822-B and submit it to the IRS. Changes to the responsible party must be reported within 60 days.
- If your business’s name has changed but the structure has not, you can submit your new business name with your tax return or mail it in a separate letter to the IRS.
- If your business structure has changed (e.g., changing from an LLC to a corporation, or a new entity forming after a merger or acquisition), you’ll generally need to apply for a new EIN.
What to do if you've lost or forgotten your EIN
Before you contact the IRS for official verification of your EIN, check your previous business tax returns, bank records, payroll documents, or other IRS correspondence. In some cases, your EIN might already appear on these documents.
If you still can’t locate your EIN or you’ve lost your CP-575, eligible Business Tax Account users can download a digital CP-575 from the IRS. Otherwise, you can call the IRS to request a 147c letter, which verifies your business’s previously issued EIN. You’ll be asked a few questions to verify your identity; once confirmed, you can choose to receive your letter via mail or fax. After you receive your 147c letter, you can use it as proof of your business’s EIN, name, and filing address.
Can a sole proprietor get an EIN — and should they?
Yes, a sole proprietor can obtain an EIN, even if they don’t need to for tax purposes.
Generally, sole proprietors need to obtain an EIN if they have employees, are tax-exempt, or have a Keogh plan or solo 401(k) retirement plan. If you’re a sole proprietor and already have an EIN, you’ll generally need a new one if you incorporate, form a partnership, or declare bankruptcy. You typically won’t need a new one simply because you change your business name or location, or own multiple businesses.
Even when an EIN isn’t required, however, many sole proprietors choose to obtain one to keep their Social Security number private when filling out business paperwork. An EIN may also make it easier to open a business bank account, apply for financing, or establish business credit as your company grows.
If you’re unsure of whether your sole proprietorship needs or would benefit from an EIN, it’s best to consult with a qualified tax professional, small business attorney, or a business advisor.
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