How to Get a Business Tax ID

A business tax ID number is also referred to as the Employer Identification Number or EIN for short. This 9-digit number is issued by the Internal Revenue Service or IRS, the tax collection agency of USA.

IRS uses these numbers to identify businesses operating in the US and its territories.

Do all businesses require a tax ID?

An EIN is not required if your sole proprietorship or LLC operates without any employees, however, you may still need one if your business files pension and excises tax returns. Even partnerships without non-partner employees are required to have an EIN.

Basically, any business with employees require an EIN. If your business doesn’t require one, just use your Social Security Number instead.

A complete list of conditions are given below to help you decide whether an EIN is required for your business or not. If you are obligated to answer “yes” to any of the following questions, your business would require an EIN.

• Do you have employees?
• Is your business a corporation or partnership?
• Do you file an employment, excise, alcohol, tobacco, or firearms tax return?
• Do you withhold taxes on income paid to a non-resident alien, other than wages?
• Do you have a Keogh plan?
• Are you involved with trusts, except certain grantor-owned revocable trusts, IRAs, or Exempt Organization business income tax returns?
• Are you involved with estates?
• Are you involved with real estate or mortgage investment conduits?
• Are you involved with nonprofit organizations?
• Are you involved with farmers’ cooperatives?
• Are you involved with plan administrators?

Why do I need to obtain a tax ID for my business?

• To open a business bank account
• To hire employees
• To apply for business licenses
• To file a tax return by mail

How do I apply for a business tax ID?

IRS makes it very easy for new businesses to obtain an EIN online. All you have to do is visit the IRS website and click on the “Apply Online Now” button to start the online application process. You will be asked to provide basic information of you and your business, including but not limited to the structure and address of your business.

Applying for a business tax ID is completely free so if a site asks you to pay, you are probably in the wrong place.

Once you complete all sections of the application, the IRS system will generate a unique EIN for your business. An official IRS document will be made available for download confirming that you have successfully completed the application. For security purposes, save a copy of the document on your computer and get a printed copy of it as well.

You can apply for your EIN by phone, fax and mail as well.

It will take up to two weeks for your new EIN to be a part of IRS’s permanent records. So until then, you won’t be able to:

• File an electronic return
• Make an electronic payment
• Pass an IRS Taxpayer Identification Number (TIN) matching program

How do I recover a business tax ID?

If you can’t remember your EIN, simply call the IRS Business & Specialty Tax Line at 800-829-4933 and choose EIN from the list of options to connect with an IRS representative.

Once connected, tell the representative that you applied for an EIN online and then lost it. The representative will ask some security questions before handing over your EIN.

How do I cancel a business tax ID?

An EIN can never be cancelled or re-assigned to someone else. It will remain available for your use.

Do I need to renew my business tax ID?

There is no expiry date for an EIN. But if your business undergoes a change in ownership or structure such as turning your sole proprietorship to a corporation, you will need to apply for a new EIN. The same goes when filing for bankruptcy.

Changing your business name does not require you to apply for a new EIN but please visit the IRS Business Name Change page for more information regarding this.