An Employer Identification Number (EIN) is a nine-digit number that Internal Revenue Service uses to identify the tax accounts of employers and certain others who have no employees. EINs are used by Employers, Sole Proprietors, Corporations, Partnerships, Nonprofit Associations, Trusts, Estates of Decedents, Government Agencies, and other business entities.
If you are a sole proprietor, your social security number can be used on all of your government forms and other official documents, but we recommend that you apply for an EIN and use that number instead. Furthermore, banks require an EIN in order to open a business bank account.
You will need an EIN if you answer "Yes" to any of the following questions:
- Do you have employees?
- Do you operate your business as a corporation or a partnership?
- Do you file any of these tax returns: Employment, Excise, or Alcohol, Tobacco & Firearms?
- Do you withhold taxes on income, other than wages, paid to a non-resident alien?
- Do you have a Keogh plan?
- Are you involved with any of the following types of organizations?
- a. Trusts, except certain grantor-owned revocable trusts, IRAs, Exempt Organization Business Income
- b. Tax Returns
- c. Estates
- d. Real Estate mortgage investment conduits
- e. Non-profit organizations
- f. Farmers' cooperatives
- g. Plan administrators