What is an EIN?
Every company should get an EIN from the IRS. This applies to LLCs, Corporations and DBAs. Even some trusts need EINs. Applying for an Employer ID allows you to open a business bank account (important for asset protection), hire employees, and file your taxes. An EIN is also referred to as:
- Employer Identification Number (EIN)
- Federal Employer Identification Number (FEIN)
- Employer ID
- Federal Tax Identification Number (FTIN)
- Federal Tax ID
- Federal Tax ID Number
Please note, this page is for obtaining an EIN for US residents (those with a SSN). Otherwise, please use our guide to obtain an EIN as a non-resident. This guide will help you obtain an EIN number for a foreign company.
When is an EIN Number Required by the IRS?
The Internal Revenue Service requires an EIN if your company:
- Has Employees (or intends to)
- Is a Multi-Member LLC
- Is a Corporation or Partnership
- Requires Business Bank Account
- Will File Income or Excise Taxes
A common, and important, reason clients form companies is for asset protection and tax savings. If a business bank account is not established then a creditor can claim comingling of funds and make an attempt to pierce the corporate veil.
To open the bank account, we recommend Relay. Relay is a no-fee, online business banking and money management platform that helps small businesses take control of their cash flow and get crystal clear on what they’re earning, spending and saving.
Sole-Proprietorships and DBAs do not have a corporate veil, but keeping their finances separate makes deducting business expenses much easier. If you use the same credit card, debit card, bank account, etc. for personal and business expenses then it can increase scrutiny by the IRS in case of an audit. It also makes keeping track of tax-deductible expenses more difficult.
For that reason we recommend all individuals engaging in business apply for an Employer Identification Number from the Internal Revenue Service.
What Information is Required?
The application must be filed all at once. So please be sure to collect the necessary information to avoid the application timing out. Most of the information is available on the company's Articles:
- The Responsible Party (and their SSN or ITIN) - "what is a responsible party?"
- Name of the Company
- Mailing Address
- Type of Entity, e.g. LLC, Corporation, DBA...
- Date of Formation
- Reason for Applying, e.g. will have employees
- Expected Number of Employees & First Date Paying Them
- Industry & Specific Line of Business
In addition to the above, please also keep in mind:
- The IRS Website is open from 7 AM to 10 PM EST.
- The site is not open on holidays
- The site goes down for maintenance around the New Year
- The responsible party may only obtain 1 FEIN per day
- You cannot change the responsible party, company name or address online
- You should save the PDF at the end or you will have to call
How to Apply for an EIN Online for Free (IRS Website)
The old way to apply was by mail or fax. We only recommend this method for anyone without a Social Security Number, i.e. Non US-Residents. Those with a SSN or ITIN can (and should) apply online. If you apply online, then you receive the number immediately most of the time (we share common IRS errors here).
If you are applying online, use this link to the IRS website. If you are faxing the SS-4, here is the form.
If the application is faxed, then it will be returned by fax and mail anywhere from 3 days to 4 weeks after submission. The delay depends on the time of year, e.g. around New Years the IRS shuts down and April 15 tax filings can slow the agency as well.
Online Application Step-by-Step Guide
- Go to the FEIN Application
- Agree to Terms and Conditions & Click "Begin Application"
- Select Your Entity: Sole Proprietor, Partnership, Corporation, LLC, Estate, Trust or "Additional" (e.g. Non-Profit, etc.)
- How many owners are there? If the LLC has one, then it's taxed as a S Sole Prop by default, and a Multi-Member is taxed as a Partnership.
- What state was the company formed in? E.g. Wyoming, Delaware, Florida, etc.
- Why are you applying? Started a new business, hired employee(s), banking, changed type of organization (e.g. converted Corporation to an LLC) or purchased a business.
- Who is the responsible party and what is their social security number (SSN) or individual taxpayer identification number (ITIN)?
- Choose if you are an owner, member, or managing member. If not, then you are a third party designee and must have a signed SS4.
- Where is the LLC physically located? You must enter a street address, city, state, zipcode and phone number. You may also enter a mailing address if different from place of business.
- Enter the company name, DBA if any, County, state company is located, state Articles were filed, and the month/year it's started.
- Tell them about the company, e.g.: do you have a vehicle weighing over 55,000 pounds, do you engage in gambling or wagering, do you need to file form 720 for excise tax, do you sell or manufacture tobacco, alcohol or firearms, do you have or expect to have employees in the next 12 months.
- What industry is the company in?
- There will be additional questions depending upon the industry, e.g. if you choose accomodations are you a hotel, a motel or other (there's a chance to write in the response).
- How do you want to received the FEIN: Online (available immediately as a PDF) or by mail (takes 4 weeks)? We always recommend choosing online and saving the PDF.
EIN Problems & Changes
What Happens if You Lose Your EIN?
It's ok if you lose your EIN, because the IRS has
it in their records. Here are your options:
1) Look at a tax return
2) Ask your banker
3) Call the IRS at 800-829-4933. They ask a few
identifying questions (for your privacy) and can
fax or mail you an official form.
Change EIN Business Name
Option 1) Notify the IRS when filing your taxes. This is
the "easiest" as your accountant does it for you, but
your bank or vendors may not be happy and insist it's
done earlier.
Option 2) Mail your CP-575 to the IRS with a cover letter
explaining you've changed your name. Include your Articles
or Formation Certificate and the amendment.
You don't need to overthink the cover letter. Something as
simple as this will suffice:
"To Whom it May Concern:
We write to inform you of our company's name change. The company,
and EIN, were initially filed as "Original Name", but we have
since changed it to "New Name".
Included you will find our original filing along with the amendment
accepted by the state. We ask you update the EIN with the IRS.
EIN Error Codes
Don't panic, an error code when applying online doesn't mean you can't get an EIN, it just means you will need to do some extra work. They are not uncommon.
Reference Number 101 Error:
This happens when another company has a similar or identical name,
this can be in the same or a different state. E.g., if your name
was used before, and the company dissolved, but did not tell the IRS
then there's a "name conflict" requiring the IRS to look further.
Fix: fax the SS-4 along with a copy of your Articles or Certificate
Reference Number 102 Error:
The IRS Records for the responsible party do not match the
SSN or ITIN that's listed. This can happen if you had a name change
(got married) or misspelled something.
Fix: try once more online and double check. If it happens again, then you must fax the SS-4.
Reference Number 103 Error:
This is here for historical reference (mismatching of responsible party
when another company), but can no longer occur given a human must be the
responsible party.
Fix: try once more online and double check. If it happens again, then you must fax the SS-4.
Reference Number 104 Error:
The third party designee (someone applying on behalf of the company, but who's
not an owner) has an identical address or phone number to the company.
Fix: ensure the third party designee has an address and phone distinct from the applicant (company).
Reference Number 105 Error:
You have made too many attempts, with various error codes, and must apply by fax
or mail.
Fix: You must mail or fax an SS-4.
Reference Number 109, 110, 112, 113 Error:
Here it's entirely an IRS related issue labeled a generic "technical difficulties". It's not
your fault and their system is malfunctioning.
Fix: Simply try again and/or wait a day. There's no telling the issue, and calling in won't get an agent who can fix it. Patience and applying again is the only solution.
Reference Number 114 Error:
You can only use a SSN or ITIN once per day to obtain an EIN. If you try twice or more,
then you receive this error.
Fix: Wait one business day.
Reference Number 115 Error:
The responsible party is listed as "deceased" or "dead" in the IRS records.
We see this one commonly (oddly enough) and it's usually fixed by double
checking spellings, SSNs or just re-applying.
Fix: Apply again and double-check, or mail/fax in the SS-4 application.
