Once you incorporate your company, you will need to get an EIN. This stands for employer identification number but is also referred to as a taxpayer ID, federal tax identification, and a range of other names. The EIN is a requirement for opening a bank account or engaging in a range of other activities that are taxable, such as having employees.
The IRS issues your EIN, so this is done federally, not on the state level. Luckily, the process of getting your EIN is free, easy, and relatively quick.
Advice Before Applying
You can apply for your EIN online, but you should know a few quick things first. Plan to complete the application in a single sitting as you cannot return to the application if you close it. Additionally, the form closes automatically if you are inactive for 15 minutes.
Begin the process of obtaining your EIN by visiting the official IRS website. Visit the Tools Menu and select the option to apply for your EIN or employer identification number. Select apply online. You will qualify as long as you have an employer ID, your own SSN, or an individual taxpayer ID number. In this case, select Apply Online.
At this point, you will be ready to start the application. You will see some restrictions and rules that you must accept before beginning the application. Select your entity type and hit continue. You will need to confirm the entity type once again and hit continue. At this stage, you will need to enter information about your business, such as the number of owners and the physical address. Once again, you will select continue before reviewing your information and hitting continue again.
From there, you need to choose a response that indicates why you are applying for the EIN. Choose whether you are a business that exists or an individual. Businesses must already have EINs while individuals must have SSNs. Continue entering information. You will need to indicate whether the party who is responsible is part of your company or a separate third party. You then need to provide more information regarding your company. Through the next screens, you will answer more questions about your business's services.
At the end of the application, you can choose the method for getting your EIN. You can get it online if you do not want to wait. Before hitting the final submit button to get your EIN instantly, review all information. If you prefer, you can also have the EIN mailed to you.
What About Foreign Filers?
Those who are foreign filers will need to have their ITIN before they can complete the application online for the EIN. If you do not have an ITIN and meet this designation, you can get an EIN, just not online. You will need to print out and complete Form SS-4 before mailing it. Remember that even foreigners need to file their tax returns and pay income taxes for their business to be legitimate.