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  1. How to Get an EIN Number for Free

How to Get an EIN Number for Free

How to Start an LLC

Obtaining a free Employer Identification Number (EIN) is a critical first move in launching a business in the United States. It might appear challenging initially, but the IRS provides several methods to acquire this free EIN, ensuring the process is uncomplicated and easily manageable for aspiring entrepreneurs.

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 for a foreign company.

When Is an EIN 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 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.

Learn More About Relay’s Free Business Banking

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 in 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

  1. Go to the FEIN Application
  2. Agree to Terms and Conditions & Click "Begin Application"
  3. Select Your Entity: Sole Proprietor, Partnership, Corporation, LLC, Estate, Trust or "Additional" (e.g. Non-Profit, etc.)
  4. 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.
  5. What state was the company formed in? E.g. Wyoming, Delaware, Florida, etc.
  6. 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.
  7. Who is the responsible party and what is their social security number (SSN) or individual taxpayer identification number (ITIN)?
  8. 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.
  9. 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.
  10. Enter the company name, DBA if any, County, state company is located, state Articles were filed, and the month/year it's started.
  11. 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.
  12. What industry is the company in?
  13. 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).
  14. 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 to 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 the 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 an 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.

From Baker to Business Owner: How the EIN Simplified Sam's Entrepreneurial Journey

Venturing into his vegan bakery enterprise, "The Leafy Loaf", Austin-based entrepreneur Sam was initially daunted by the task of getting an EIN. However, he found the IRS's online EIN application process to be straightforward and cost-free. From his home, he navigated the user-friendly IRS portal to quickly get his EIN, which facilitated him in handling essential business tasks such as opening a bank account, applying for a loan, and hiring employees.

In an incident where Sam misplaced his EIN, he could promptly retrieve it through a simple identity verification call to the IRS. This seamless EIN-related experience allowed Sam to focus his energy on his bakery, contributing to its eventual success. His story underscores the efficiency with which the IRS facilitates business setup, empowering entrepreneurs to bring their visions to fruition.

Four Free Methods to Obtain an Employer Identification Number (EIN)

There are several free methods available to get an EIN. Here's a brief rundown:

1. Get EIN Online:

The quickest and simplest way is via the IRS website's online EIN application portal, usually accessible Monday to Friday, 7 AM to 10 PM Eastern Time. Remember, the application must be completed in one go as progress can't be saved.

2. Postal EIN Acquisition by Sending Form SS-4 to IRS:

If traditional methods are your preference, mail Form SS-4 to the IRS. Keep in mind, it could take up to four weeks for the IRS to process your EIN.

3. Fax Method for EIN Issuance:

You can fax Form SS-4 to the IRS. They typically respond within four business days, faxing your EIN back to you.

4. Phone Request for EIN (Specifically for International Applicants):

International applicants without a Social Security Number or Individual Taxpayer Identification Number can call the IRS directly to get an EIN.

IRS EIN Requirement Scenarios

Various business situations require an EIN. For instance, businesses that operate as a corporation or partnership need an EIN. Non-profit organizations, estates of descendants, and certain trusts that have income subject to reporting, among others, also require an EIN. Additionally, if your business has employees, you'll need an EIN for reporting and paying employment taxes.

Is an EIN Necessary for Self-employed Individuals?

For self-employed individuals, obtaining an EIN isn't always mandatory. If you're operating without employees, you can use your Social Security Number for tax purposes. However, having an EIN can provide benefits, such as keeping your personal and business finances separate, and offering an extra layer of privacy protection. Additionally, if you plan to hire employees in the future or want to establish business credit, having an EIN would be necessary and beneficial.

Is an EIN Required for a Limited Liability Company (LLC)?

The necessity of an EIN for an LLC varies based on specific business circumstances. If the LLC has more than one member or if it has employees, an EIN is required regardless of tax classification. Single-member LLCs without employees may use the owner's Social Security Number for tax purposes. However, obtaining an EIN can be beneficial, providing separation between personal and business finances and allowing the LLC to establish business credit.

Does Your Business Require an EIN?

Determining whether your business needs an EIN depends on several factors such as your business structure, tax status, and operational requirements. Entities like corporations, partnerships, non-profits, and businesses with employees generally require an EIN.

Sole proprietorships may need one for specific activities like setting up retirement accounts. If uncertain, consult with a tax advisor or business attorney to ascertain your unique needs and ensure your business's compliance with IRS regulations.

Is an EIN Necessary for Loan Procurement?

An EIN is usually required when applying for business loans. Lenders often ask for it to verify the existence and legal status of your business. It allows them to ensure the creditworthiness of the business separate from the personal credit of the owner. If you plan to secure a loan for your business operations or expansion, having an EIN is an essential step in the loan application process.

Do Financial Institutions Require a Business's EIN?

Yes, financial institutions generally require a business's EIN for a multitude of transactions. An EIN is crucial for setting up a business bank account or applying for business credit cards. This unique identifier separates your personal finances from your business finances, providing an essential layer of protection.

Additionally, if your business receives payments for goods or services, the payer may need your EIN for their tax documentation. Thus, having an EIN is a fundamental part of establishing and operating a legitimate and compliant business in the financial ecosystem.

Are There Any Charges for EIN Acquisition?

There are no charges to obtain an EIN from the IRS directly. It's a free service provided by the IRS to help businesses comply with tax laws. All methods of acquiring an EIN, including online, mail, fax, and phone (for international applicants), are provided at no cost. However, some third-party agencies and businesses charge fees for assisting in the EIN application process. It's always prudent to keep in mind that the IRS never charges a fee, and businesses can easily apply for an EIN independently.

Designating the Responsible Party in EIN Application

During an EIN application, the IRS necessitates assigning a 'responsible party', an individual who oversees the applicant entity's operations and funds. Usually, this could be a business owner or a principal officer. Their role is pivotal, as the IRS communicates with them regarding any tax-related issues pertaining to the business. If there's a substantial shift in the business structure, the details of the responsible party can be updated.

EIN Eligibility Criteria

An EIN is essential for numerous U.S. businesses, encompassing corporations, partnerships, non-profits, and sole proprietorships. It is required for entities with employees, corporations, partnerships, those filing specific tax returns, and businesses withholding taxes on income paid to non-resident aliens. Some trusts, estates, and non-profit organizations also necessitate an EIN. Ensuring your business meets these eligibility criteria is crucial.

EIN Issuance Duration

The time it takes to receive an EIN can vary depending on the method of application. If you apply online, the issuance is almost immediate. You'll receive your EIN as soon as you complete and submit the application. However, if you choose to fax the form SS-4, it typically takes about four business days. For mail applications, the process is slower and may take up to four weeks, so plan accordingly.

Possibility of EIN Alteration

The Employer Identification Number (EIN) assigned by the IRS to your business is meant to be a unique, stable identifier. However, under certain conditions, such as changes in business structure or ownership, you may need to obtain a new EIN. Be aware, though, that the existing EIN can't be 'altered' or 'updated'. It remains linked with the business entity it was originally assigned to, and a completely new EIN must be requested for the new entity.

Retrieving Your Employer Identification Number

If you've misplaced your Employer Identification Number (EIN), don't panic. The IRS has a system in place to help you recover it. You can contact the IRS's Business and Specialty Tax Line during their operating hours. After verifying your identity, they will be able to provide you with your EIN. However, it's important to remember that the IRS will only share the EIN with the authorized individual, executor, trustee, or designated third party of the business.

Utilizing Your EIN

Your free Employer Identification Number (EIN) serves as a crucial identifier for your venture. This free EIN not only enables the IRS to monitor your business's tax reporting but also streamlines various business operations. It comes into play when filing tax returns, inaugurating business bank accounts, securing business loans, and hiring staff. Furthermore, using your EIN in lieu of your Social Security Number in business paperwork enhances privacy and minimizes identity theft risk.

Obtaining this free EIN is a pivotal move in the business development journey. The IRS, recognizing its importance, has made the acquisition process both user-friendly and cost-free. With these methods at their disposal, entrepreneurs can concentrate on their business targets, establishing a strong base for their enterprise to prosper in the competitive market landscape.