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  • Business Tax Basics for Beginners

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    What’s an EIN Number and Do I Need One?

    Typically, most businesses need an Employer Identification Number (EIN), also known as a Federal Tax Identification Number. This nine-digit number, expressed as XX-XXXXXXX, is used to identify your business on all business tax reporting returns and forms.

    You will need an EIN if you answer YES to any of the following questions:

    • Do you have employees?
    • Is your business a corporation or a partnership?
    • Do you file employment, excise, or Alcohol, Tobacco and Firearms returns?
    • Do you withhold wages on income, other than wages paid to a non-resident alien?
    • Do you have a qualified retirement plan?

    And a bank will want your EIN before you open a business bank account.

    You can apply for a new EIN online. There is no charge for this service so beware of any private website that charges a fee to supply an EIN. You can also apply by phone, fax or mail. Simply complete and return Form SS-4, which you can download from the IRS website or request by calling 1-800-TAX-FORM. If you apply online or by phone, you can get your EIN quickly. A faxed application may take one to two weeks to be processed and a mailed application could take up to four weeks. Make sure you have your EIN before you need to file a return or make a tax deposit.