The Employer Identification Number (EIN – also known as Tax ID Number), is a nine-digit number issued to businesses by the IRS. Obviously, a business that has employees needs an EIN, but there are instances when all business types and even individuals may need to get an EIN.
Who Needs an EIN
Keep in mind – EINs are not transferable, so if you buy or sell a business you or the new owner will need to get a new number. The IRS PDF file Understanding your EIN explains all this in detail.
You need an EIN if:
• You have employees.
• Your business is operated as a Partnership or Corporation.
• You’re required to file Employment, Excise, or ATF Tax Returns
• You withhold taxes on income, other than wages, paid to a non-resident alien
• You have a Keogh Plan
• You’re involved in certain organizations such as trusts, estates, & farmer co-ops
How to Get Your Tax ID Number
To apply for an EIN taxpayers will need to use the IRS Form SS-4. You can apply for your EIN by mail, phone, fax, or online (you complete the form online). It’ll take anywhere from a couple of hours to several weeks to get your number depending on which method you choose to apply.