HOME

TheInfoList



OR:

The Employer Identification Number (EIN), also known as the Federal Employer Identification Number (FEIN) or the Federal Tax Identification Number (FTIN), is a unique nine-digit number assigned by the
Internal Revenue Service The Internal Revenue Service (IRS) is the revenue service for the Federal government of the United States, United States federal government, which is responsible for collecting Taxation in the United States, U.S. federal taxes and administerin ...
(IRS) to business entities operating in the United States for the purposes of identification. When the number is used for identification rather than employment tax reporting, it is usually referred to as a
Taxpayer Identification Number A Taxpayer Identification Number (TIN) is an identifying number used for tax purposes in the United States and in other countries under the Common Reporting Standard. In the United States it is also known as a Tax Identification Number (TIN) ...
(TIN). When used for the purposes of reporting employment taxes, it is usually referred to as an EIN. These numbers are used for tax administration and must not be used for any other purpose. For example, an EIN should not be used in tax lien auction or sales, lotteries, or for any other purposes not related to tax administration.


Comparison to Social Security numbers

A
social security number In the United States, a Social Security number (SSN) is a nine-digit number issued to United States nationality law, U.S. citizens, Permanent residence (United States), permanent residents, and temporary (working) residents under section 205(c)(2 ...
(SSN) is a nine-digit number assigned to
US citizen Citizenship of the United States is a citizenship, legal status that entails Americans with specific rights, duties, protections, and benefits in the United States. It serves as a foundation of fundamental rights derived from and protected by ...
s and permanent residents. It is used by the US government to track your earnings, taxes, and employment, as well as eligibility for certain social benefits after retirement. SSNs are considered sensitive information and can be used to perpetrate
identity theft Identity theft, identity piracy or identity infringement occurs when someone uses another's personal identifying information, like their name, identifying number, or credit card number, without their permission, to commit fraud or other crimes. ...
, thus they are only shared in limited situations, for example, with employers, government entities, insurance agencies, and banks. SSNs can be validated as to origin and state/year of issuance. The EIN serves a similar administrative purpose as a SSN, but for a business entity rather than an individual person. In some cases, such as a
sole proprietorship A sole proprietorship, also known as a sole tradership, individual entrepreneurship or proprietorship, is a type of enterprise owned and run by only one person and in which there is no legal distinction between the owner and the business entity. ...
, an SSN may be used as a business Tax ID without applying for a separate EIN, but in order to hire employees or establish business credit, an EIN is required. Unlike a SSN, an EIN is not considered sensitive information and is freely distributed by many businesses by way of publications and the internet.


EIN format

The EIN system was created by the IRS in 1974 by Treasury Decision (TD) 7306, 39 Fed. Reg. 9946. The authority for EINs is derived from 26
USC USC may refer to: Education United States * Universidad del Sagrado Corazón, Santurce, Puerto Rico * University of South Carolina, Columbia, South Carolina ** University of South Carolina System, a state university system of South Carolina * ...
6011(b), requiring taxpayer identification for the purpose of payment of employment taxes. The provision was first enacted as part of the revision of the Tax Code in 1954. This authority was broadened in 1961 by 26 USC 6109. An EIN is usually written in form 00-0000000 whereas a
Social Security Number In the United States, a Social Security number (SSN) is a nine-digit number issued to United States nationality law, U.S. citizens, Permanent residence (United States), permanent residents, and temporary (working) residents under section 205(c)(2 ...
is usually written in the form 000-00-0000 in order to differentiate between the two. There are EIN Decoders on the web that can identify in what state the company registered the EIN. A business needs an EIN in order to pay employees and to file business tax returns, as well as to open corporate accounts with financial institutions such as banks, credit unions, and brokerage houses. To be considered a Partnership,
LLC A limited liability company (LLC) is the United States-specific form of a private limited company. It is a business structure that can combine the pass-through taxation of a partnership or sole proprietorship with the limited liability of a ...
, Corporation,
S Corporation An S corporation (or S Corp), for United States federal income tax, is a closely held corporation (or, in some cases, a limited liability company (LLC) or a partnership) that makes a valid election to be taxed under Subchapter S of Chapter 1 of t ...
, Non-profit, etc. a business must obtain an EIN. This applies to business with no
income Income is the consumption and saving opportunity gained by an entity within a specified timeframe, which is generally expressed in monetary terms. Income is difficult to define conceptually and the definition may be different across fields. F ...
, which are not exempt from filing federal income tax returns. Before 2001, the first two digits of an EIN (the EIN Prefix) indicated the business was located in a particular geographic area. In 2001, EIN assignment was centralized at three of the IRS campuses, although all 10 campuses can assign an EIN, if necessary.


Tax-exempt, charitable, non-profit organizations, and EINs

The issuance of an EIN to a
non-profit organization A nonprofit organization (NPO), also known as a nonbusiness entity, nonprofit institution, not-for-profit organization, or simply a nonprofit, is a non-governmental (private) legal entity organized and operated for a collective, public, or so ...
does not automatically grant
tax-exempt status Tax exemption is the reduction or removal of a liability to make a compulsory payment that would otherwise be imposed by a ruling power upon persons, property, income, or transactions. Tax-exempt status may provide complete relief from taxes, redu ...
from the IRS, which must be obtained separately. Each chapter of a national non-profit organization must have its own EIN, but the central organization may file for a group tax exemption. Tax Exemption status is publicly searchable on the IRS website, allowing anyone to verify an entity's registration, status, and assets and liabilities. Before donating monies to a charity, it is advisable to verify the charity's IRS Form 990 tax-exempt status via the IRS Tax Exempt Organization Search. Before applying for an EIN, it is always preferred to check whether the affected organization has been formed legally or not. Almost all organizations that apply for EINs can have their tax-exempt status automatically revoked if they have failed to file a necessary return or notice for a period of three years consecutively. Such a three-year period begins when the organization is legally formed; it is best to form the organization legally before applying for an EIN.


EIN expiration/cancelation

EINs do not expire. Once an EIN has been issued to an entity, it will never be reissued, although a business may elect to cancel or change its current EIN for specific reasons. Cases include purchasing or becoming a subsidiary of another business, or of changes to the ownership structure of the business, or if a sole proprietorship is subject to bankruptcy proceedings. Changing business location or business name, doesn't require getting a new EIN, but the change still needs to be reported to the IRS. A change of business address can be reported using IRS Form 8822 B. A change of business structure can be reported with an IRS Form 8832. A new EIN assigned to a business will automatically replace an existing EIN, and the old EIN will become inactive and not be reissued. Likewise, if a business is dissolved, then the EIN will become inactive, closing the account with the IRS. There is no way to cancel or remove an EIN, as it is a permanent Federal taxpayer identification number once assigned.


See also

* CAGE Code issued by the Defense Logistics Information Service (DLIS) to identify suppliers to the
Department of Defense The United States Department of Defense (DoD, USDOD, or DOD) is an executive department of the U.S. federal government charged with coordinating and supervising the six U.S. armed services: the Army, Navy, Marines, Air Force, Space Force, ...
* D.U.N.S. number issued by
Dun & Bradstreet The Dun & Bradstreet Holdings, Inc. (D&B) is an American company that provides commercial data, analytics, and insights for businesses. Headquartered in Jacksonville, Florida, the company offers a wide range of products and services for risk a ...
and required for certain U.S. government contractors and federal grant recipients * Confidential T.P.I.N. number issued by the Central Contractor Registry of the U.S. Government *
VAT identification number A value-added tax identification number or VAT identification number (VATIN) is an identifier used in many countries, including the countries of the European Union, for value-added tax purposes. In the EU, a VAT identification number can be verif ...
, the analogous identification in the
European Union The European Union (EU) is a supranational union, supranational political union, political and economic union of Member state of the European Union, member states that are Geography of the European Union, located primarily in Europe. The u ...
and other countries using
VAT A value-added tax (VAT or goods and services tax (GST), general consumption tax (GCT)) is a consumption tax that is levied on the value added at each stage of a product's production and distribution. VAT is similar to, and is often compared wi ...


References


External links


Employer Identification Number (EIN)
at IRS.gov
IRS Publication 1635: Understanding Your EIN
at IRS.gov
How to Apply for an EIN
at IRS.gov
When to get a new EIN
at IRS.gov
Get federal and state tax ID numbers
at SBA.gov {{Authority control Unique identifiers Taxation in the United States Employers Company identification numbers