When you start any new business or an organization, one need to obtain an Employer Identification Number (i.e. EIN). Otherwise you may encounter the questions concerning your business legitimacy especially by the government agencies. An Employee Identification Number (i.e. EIN) is a nine-digit unique number issued to you by the Internal Revenue Service (i.e. IRS) which is used to identify your business or organization.
Why you need to apply for an EIN?
Though all the business entities or organizations can benefit from an EIN, but there are times when an EIN is required by the Internal Revenue Service (i.e. IRS), including if your business or organization has employees. You need to have an EIN, if your business fall in these categories such as –
- The organization is a single owner business with employees.
- Your business is a single member LLC or multiple member LLC.
- The business is an LLC taxed as a corporation or an orgaization.
- Your business is a partnership.
- The business entity deals with the estates, trusts, employee plans.
- Your business manage and report the payroll taxes.
- You change your business entity from a sole proprietorship to some another type of the business.
What are the benefits to having an EIN for the business?
The benefits of having an EIN for the business or organization are –
- EIN offers safety for the sole proprietors or individuals.
- It can help the companies to establish the credit.
- It can help the companies or organizations to obtain all the necessary business licences and permits.
In most of the cases, one need to have an EIN so as to establish the credit for your business or organization. For instance, if you need to open a bank account using your business name, the bank will require you to have an EIN along with all the necessary business information.
How one can apply for an EIN?
In order to file an EIN application, the responsible party need to complete the Application Form SS4 for their type of the business entity or organization. This Form SS4 is available for download through the IRS website. You can file the Form SS4 either online or by mail. One thing you need to remember that you can apply for one EIN per day. In many cases, the responsible applicant must also have a valid Social Security Number (i.e. SSN) or Individual Taxpayer Identification Number (i.e. ITIN) to request an EIN on behalf of another business or organization.
The IRS has made the process of applying the EIN quite easier, by allowing the businesses to apply for an EIN online and get the EIN instantly. This is a free service provided by the Internal Revenue Service (i.e. IRS). In order to apply for an EIN there are several ways such as – one can apply EIN by online, by mail or by fax or by phone.
Online – One can apply for an EIN online. The EIN application is processed online and an EIN is issues instantly to an individual. In order to apply online, one need to visit the IRS website and have to fill the application form with all the necessary details related to the business. After filing all the necessary details in the form, one need to submit the application form. When you submit the application form, IRS will generate your EIN regarding your business instantly.
By Mail or Fax – In order to apply for an EIN by Mail or Fax, one need to take the print out of the application Form SS4 first. Fill out all the necessary details regarding your business in the application form and sign and date it at the bottom of the application form. Once the Form SS4 is filled you need to fax or mail the completed application Form SS4. In order to Mail the application Form SS4, you need to send the application form to the IRS office at the following address –
- Internal Revenue Service
- Attn: EIN Operation
- Cincinnati, OH 45999
But if you want to Fax, the completed application Form SS4 then you can fax the application to the IRS office.
By Phone – Only the international applicants can apply for an EIN over the Phone call. In order to apply for an EIN over the Phone the international applicants need to call the IRS number from 06:00 AM to 11:00 PM (Monday to Friday) Eastern Time. One can get the EIN for the business or organization at the end of the phone call.