Information About Employer Identification Numbers (EINs)
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IRS Requirements & How to Apply for an EIN
An Employer Identification Number (EIN) is a 9-digit number issued by the IRS for the purposes of identifying a particular business’ tax account. The EIN format is XX-XXXXXXX..
EINs are used by employers, sole proprietors, corporations, partnerships, non-profits, trusts, estates of decedents, government agencies, certain individuals, and other business entities. These entities must provide their EIN on every form/communication that is sent to the Internal Revenue Service (IRS) or the Social Security Administration (SSA).
Note that you should have only 1 (one) EIN for the same business entity. If you do not have an EIN by the time your tax return is due, enter “Applied For” (and the date that you applied) wherever an EIN is requested. Do not use your Social Security Number (SSN) in lieu of an EIN.
Do You Need an EIN?
If you are required to report employment taxes or give tax statements to employees or annuitants, you will need an EIN. You will also need an EIN if you pay excise tax.
In general, you will need an EIN if any of the following apply:
• You have employees
• You operate your business as a corporation or a partnership
• You file any of these tax returns: Employment, Excise, or Alcohol, Tobacco, and Firearms
• You withhold taxes on income (other than wages) paid to a non-resident alien
• You have a Keogh plan
• You are involved with any of these types of organizations: Trusts (except certain grantor-owned revocable trusts), IRAs, Exempt Organization Business Income Tax Returns, Estates, Real Estate Mortgage Investment Conduits (REMICs), Non-Profit Organizations, Farmers’ Cooperatives, or Plan Administrators
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There are also a number of circumstances where you may need to apply for a new EIN. Below are the EIN guidelines for sole proprietorships, partnerships, corporations, estates, and trusts.
Sole Proprietorships
If you have a sole proprietorship, you will need a new EIN if any of the following apply:
• You are subject to a bankruptcy proceeding
• You incorporate
• You take in partners and operate as a partnership
• You buy or inherit an existing business that you operate as a sole proprietorship
A sole proprietorship does not need a new EIN if any of the following are true:
• You change the name of your business
• Your change your business location or add locations (e.g., stores, plants, or branches of the entity)
• You operate multiple businesses (e.g., stores, plants, or branches of the entity)
Partnerships
As a partnership, you will need a new EIN if any of the following apply:
• You incorporate
• One of the partners takes over and operates as a sole proprietorship
• The partnership is terminated and a new partnership is begun
A partnership does not need a new EIN if any of the following apply:
• The partnership declares bankruptcy
• The partnership name changes
• The location of the partnership changes or new locations are added (e.g., stores, plants, or branches of the entity)
• The partnership terminates under IRC Section 708(b)(1)(B) and a new partnership is formed as a result
• 50% or more of the ownership of the partnership changes hands within a 12-month period
Corporations
A corporation must apply for a new EIN if any of the following are true:
• It is a subsidiary of a corporation and currently uses the parent’s corporate EIN, or it becomes a subsidiary of a corporation
• The corporation becomes a sole proprietorship or partnership
• A new corporation is created after a statutory merger
• It receives a new corporate charter from the Secretary of State
A corporation does not need a new EIN if any of the following apply:
• It is a division of a corporation
• After a corporate merger, the surviving corporation uses the existing EIN
• The corporation declares bankruptcy
• The corporation name changes
• The location of the corporation changes or new locations are added (e.g., stores, plants, or branches of the entity)
• It elects to be taxed as an S Corporation
• Reorganization of a corporation only changes the identity or place
• There is conversion at the state level with business structure remaining unchanged
Estates
An estate will need a new EIN if any of the following apply:
• A trust is created with estate funds (not simply a continuation of the estate)
• You represent an estate that operates a business after the owner’s death
An estate does not need a new EIN if the following statement is true:
• The administrator, personal representative, or executor changes their name or address
Trusts
A trust will need a new EIN if any of the following apply:
• One person is the grantor/maker of many trusts
• A trust changes to an estate
• A living or intervivos trust changes to a testamentary trust
• A living trust terminates by distributing its property to a residual trust
A trust does not need a new EIN if any of the following apply:
• The trustee changes
• The grantor or beneficiary changes their name or address
For more information, refer to the IRS website and Publication 1635 (Employer Identification Number).
How to Get an EIN
There are 3 main ways to obtain an EIN: you can apply online, by fax, or by paper mail.
If you apply online, you will be issued an EIN immediately and you can use it right away for most purposes. Or you can fill out Form SS-4 (Application for Employer Identification Number) and fax it to the IRS, and then you will receive a fax back with your EIN in about 4 business days. Finally, if you mail Form SS-4, it can take up to 4 weeks to be processed and the IRS will send your EIN via paper mail.
If you have lost or misplaced your EIN, the IRS will retrieve it for you as long as you are authorized to receive that information. You can call the Business & Specialty Tax Line (1-800-829-4933) to ask the IRS to search for your EIN. Additionally, if you have more than one EIN for the same business but you’re not sure which one to use, you can call the Business & Specialty Tax Line for clarification.
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