Purpose of EIN Number
An EIN is an acronym for “Employer Identification Number." It is a nine-digit number the IRS assigns to businesses for tax purposes. EINs identify tax accounts of employers and non-employer entities. The IRS issues EINs for federal tax reporting and filing. An EIN works similarly to an SSN but for business matters.
You need an EIN for many business activities. These include opening bank accounts, hiring staff, acquiring licenses, and filing taxes. Banks and creditors also require EINs on financial applications.
What is an EIN?
An EIN identifies your business to the government. It allows reporting taxes and paying employees. Apply through the IRS website or by mail. Provide basic details like business type and location.
Once assigned, an EIN never expires or transfers. Format it as 12-3456789. This ID resembles a Social Security number but serves different legal and financial purposes.
Unique Identifier for Businesses
The IRS assigns a unique tax identification number to individuals, corporations and nonprofits. If you lack an EIN by mid-April, still file taxes using Form 4852. Sole proprietors without employees often don’t need EINs.
An EIN, short for Employer Identification Number, is a unique nine-digit identifier issued by the Internal Revenue Service (IRS) to businesses and other entities operating in the United States. It serves as a tax ID for reporting employment taxes and other business-related activities.