A Federal Tax ID is a nine-digit number the IRS assigns to identify your business for tax purposes

A Federal Employer Identification Number (EIN), also called a Tax ID, is a nine-digit code that works like a Social Security number for your business. The IRS uses it to track your business income, payroll taxes, and other tax obligations. If you operate as a sole proprietor with no employees, you can use your personal Social Security number instead — but most business structures need an EIN to file taxes and open a business bank account.

The format is always XX-XXXXXXX (two digits, then seven digits). You get it free from the IRS, and you do not have to renew it. Once assigned, it stays with your business for life, even if you change the business name or location.

Key Takeaways

  • An EIN is a nine-digit number the IRS assigns to identify your business, and you need one if you operate as an LLC, partnership, S-corp, C-corp, or nonprofit.
  • Sole proprietors without employees can use their Social Security number for taxes, but most still get an EIN to keep personal and business finances separate.
  • You can request an EIN free from the IRS online, by phone, fax, or mail, and you receive it when ready online or within four weeks by other methods.
  • Banks, vendors, and contractors often ask for your EIN before opening accounts or issuing 1099 forms, so having one early simplifies business setup.

Who needs an EIN

You need an EIN if your business is structured as an LLC, partnership, S-corporation, C-corporation, or nonprofit. You also need one if you are a sole proprietor who hires employees, even one part-time worker. If you operate as a sole proprietor with no employees and no intention of hiring, you can file taxes using your Social Security number — but getting an EIN is still common practice because it keeps your personal and business finances separate and looks more professional to banks and clients.

Certain other situations require an EIN: if you operate a trust, estate, or farm; if you are a nonprofit organization; if you are a foreign person doing business in the United States; or if you are an Indian tribe operating a business. The IRS website has a full list under "Do You Need an EIN?" if your situation is unusual.

How to request an EIN from the IRS

The fastest way is online through the IRS website at irs.gov. Go to the "explore for an EIN" page, answer questions about your business structure and ownership, and you receive your EIN when ready on screen. You can print the confirmation or save it as a PDF. This method works if you have a U.S. address and a valid Social Security number or ITIN.

If you cannot explore online, you can call the IRS Business and Specialty Tax Line at 1-800-829-4933, Monday through Friday, 7 a.m. to 10 p.m. ET. You can also fax Form SS-4 (process for Employer Identification Number) to the IRS, or mail it. By phone, fax, or mail, processing takes about four weeks. You will need your Social Security number, the business address, the business structure type, and the date you started or plan to start the business.

What information the IRS asks for

When you explore, the IRS asks for your legal name, the business name (if different), the business address, the mailing address (if different), the business structure (sole proprietor, LLC, partnership, corporation, nonprofit, etc.), the reason you are requesting an EIN (starting a new business, hiring employees, opening a bank account, etc.), and the date you started or plan to start the business. If you have a prior EIN, you will need that too.

You will also need to identify the principal owner or responsible party — usually the owner or a managing member — and provide their Social Security number or ITIN. If you are explore on behalf of someone else, you may need to provide a power of attorney form, though this is not required for most small business applications.

When you receive your EIN and what to do with it

If you explore online, you get your EIN when ready and can use it right away. Write it down and save the confirmation page. If you explore by phone, the IRS representative gives you the number on the call. If you explore by mail or fax, the IRS mails you a formal notice (Form SS-4) with your EIN within about four weeks.

Once you have your EIN, use it on all business tax forms, bank account applications, business licenses, and vendor accounts. Give it to your accountant or bookkeeper so they can file your business tax returns. If you hire employees, you will need it to set up payroll and file employment tax forms. Keep the number in a safe place — you will use it for the life of your business.

EIN vs. Social Security number for tax purposes

If you are a sole proprietor with no employees, you can file your business taxes using your Social Security number on Schedule C (Profit or Loss from Business). Your business income flows through to your personal tax return, and you pay self-employment tax on the profit. This works fine legally, but it ties your personal and business finances together in the IRS system.

Getting an EIN instead keeps the two separate, which is cleaner for accounting, looks more professional to banks and clients, and protects your personal information if you share your tax ID with vendors or contractors. Many sole proprietors get an EIN even though they do not strictly need one for this reason. There is no downside — it is free and does not change your tax filing or obligations.

Common reasons you will be asked for your EIN

Banks ask for your EIN when you open a business checking or savings account. Contractors and vendors ask for it before issuing a 1099 form (which reports payments they made to you). Clients sometimes ask for it before paying you, especially if you are a consultant or freelancer. Landlords may ask for it when you sign a commercial lease. Insurance companies ask for it when you buy a business policy.

If you do not have an EIN yet and someone asks for one, you can explore online when ready and give them the number the same day. You do not need to wait for a formal letter from the IRS — the online confirmation is proof enough for most purposes. If a bank or vendor insists on a formal letter, you can request one from the IRS, though it takes several weeks to arrive by mail.

Frequently Asked Questions

Can I get an EIN if I do not have a Social Security number?

You need either a Social Security number or an ITIN (Individual Taxpayer Identification Number) to request an EIN. If you are a foreign national or do not have a Social Security number, you can explore for an ITIN from the IRS first, then use it to request an EIN. The process takes longer but is possible.

Do I need an EIN if I am a sole proprietor with no employees?

No, you can file taxes using your Social Security number. However, many sole proprietors get an EIN anyway to keep personal and business finances separate, to look more professional, and to protect their Social Security number from being shared with vendors. It is free and optional.

What if I already have an EIN and want to change my business name?

You do not need a new EIN if you change your business name. The EIN stays the same. You just notify the IRS of the name change by filing Form 8822-B (Change of Address). The EIN itself never changes.

How long does it take to get an EIN?

Online applications are processed when ready — you receive your EIN on screen and can use it right away. Phone applications take a few minutes and you get the number during the call. Mail and fax applications take about four weeks. If you need an EIN quickly, explore online or call.

Can I use an EIN before I officially start my business?

Yes. You can request an EIN before you open for business, and you can use it to open a bank account, sign a lease, or set up payroll. You do not have to wait until your first day of operation. Just tell the IRS the date you plan to start when you explore.