Day: September 27, 2019

If you are a business owner, as much as you want to make money immediately, you still need to make sure that you are operating in line with the law. You need to get some government permits or licenses as a requirement to operate but you should know that you couldn’t go through this process if you do not have an EIN (Employer Identification Number).

EIN is a type of tax ID issued to businesses by the IRS (Internal Revenue Service). EIN is composed of a unique 9-digit number like your SSN (Social Security Number). Ultimately, the number is your identification and it is crucial in all tax documents, forms, and licenses.

Fortunately, the IRS makes it easy to apply for a federal tax id or EIN. To help you get started, here are some tips:

Determine whether you need EIN or not

The first thing that you need to do is to determine whether you need EIN or not. This is important if you do not want to waste your time and effort. You need EIN if:

• You are a corporation, LLC or a limited partnership.
• The business deals with trusts, nonprofit organizations, estates, farmers’ cooperatives, and retirement accounts.
• You do not want to use your SSN for your business.
• You have employees or you file tax returns.
• You withhold income tax while making payment.

Apply for EIN

There are many ways you can apply for EIN. You can consider the following ways:

• If you are outside the United States, you can apply via phone. The toll-free number is 800-829-4933. You must remember business hours through – from 7 am to 10 pm local time. The staff will take relevant information and EIN will be given before ending the call.
• Another way to apply is by sending the application through fax. You just need to fill out Form SS-4. The fax number will depend on the state but you can usually find it at the IRS.gov site and within four business days, IRS will send the EIN.
• You can also apply via regular mail. This is the longest route as it can take up to 4 weeks.
• The easiest is applying online. If you are inside the United States, applying online is the fastest because of this. You just need to visit the site and then locate the EIN Assistant page to commence.

Answer the short questions provided

As soon as you clicked on the “Begin Application” button, you will be directed to a page with short questions. The questions should be answered so you can proceed. The questions include the following:

• What is the type of EIN you are applying to? This can be answered based on your business entity like sole proprietorship, corporation, LLC or partnership.
• Why apply for EIN? You should pick an option that best describes why you need the EIN.
• What is your SSN? You should give relevant information to complete your application.

Save the document

After completing all the sections, the system will immediately generate EIN. The good news is you can use the EIN right away. It is a good idea to save a copy of the EIN on your computer.