Employer Identification Number (EIN) Overview
Your Employer Identification Number (EIN) is your federal tax ID. It is essential for various business activities such as paying federal taxes, hiring employees, opening a bank account, and applying for licenses and permits.
Can I Use EIN Instead of Tax ID?
EIN refers to an Employer Identification Number, a nine-digit ID used for tax purposes to identify businesses or individuals. You need an EIN for several business activities like paying taxes, hiring employees, and applying for licenses.
Understanding the Difference Between EIN and Tax ID Numbers
A tax ID number is an umbrella term for any identification number used for tax purposes, while an Employer Identification Number (EIN) is a specific type of tax ID number issued to businesses and entities.
Types of Tax ID Numbers:
- Social Security Number (SSN) – For individuals
- Employer Identification Number (EIN) – For businesses and entities
- Individual Taxpayer Identification Number (ITIN) – For non-resident immigrants
An EIN is a 9-digit number that identifies a business as a separate entity from its owners for tax purposes, required for various business activities like paying federal taxes and hiring employees.