EIN: The Basics
For federal income tax purposes, a single-member LLC classified as a disregarded entity generally must use the owner’s social security number (SSN) or employer identification number (EIN) for all information returns and reporting related to income tax. An EIN is a nine-digit number allocated to a business. It’s an essential piece of information for letting the IRS know about your income and helps with processes like payroll and employee pensions. An EIN is also known as a Federal Tax ID Number, or FTIN, and identifies a business entity. Business entities–corporations, partnerships, and limited liability companies are required to use EINs.
Obtaining and Using Multiple EINs
A single business or entity can have only one EIN, although there are situations where you will need to apply for a new one due to changes to your business. Here are some relevant details regarding multiple EINs:
- How Many EINs Can I Have? The number of EINs you are allowed is as many as the number of business entities you have.
- Getting an EIN does not cost any money, and the easiest and most common way to obtain one is by applying online.
- How many EINs can I get per day? The IRS issues only one EIN per responsible party per day.
Specific Scenarios
An EIN is required per legal entity, meaning that separate LLCs or corporations will each need their own EIN. However, it is not possible to use the same EIN for different entity types or for businesses that are not related. If you’re expanding or restructuring your business, you might need multiple EINs:
- Multiple Businesses Under One LLC: You can have multiple businesses under one LLC.
- Subsidiaries: A subsidiary is an entity that is majority or entirely owned by another entity. It will need its own EIN.
- Sole Proprietors: Most sole proprietors don’t need to obtain an EIN and can use their SSN instead. A sole proprietor can only be issued one EIN.
Applying for a New EIN and Addressing EIN Issues
- Can I apply for a new EIN if I already have one? Yes, you may apply for multiple EINs as long as each is for a separate business entity.
- What happens if I have 2 EIN numbers? Contact the IRS; they will likely advise you to use one number and disregard the other.
- Change Business Name on EIN: In some situations a name change may require a new EIN or a final return.
EINs do not expire and are permanent federal taxpayer identification numbers for the business entity they are assigned to.