The EIN (Employer Identification Number) is used to identify a business entity. Documents are sent to the IRS for the EIN application. When you get the EIN number, you will see it is a 9-digit number. The IRS uses this number to identify taxpayers who must file various business tax returns. In short, every business operating in the United States has a unique EIN number.
Why Do I Need an EIN Number?
Many companies that complete the incorporation process in the United States need a business bank account. Having a business bank account will professionally manage your expenses and payments. Many banks in the US or providing online services require an EIN to open a business bank account. Also EIN application is a necessary process to obtain a business credit card.
To employ someone in your company in the United States, you must still have an EIN number. The IRS uses the business’s EIN to track taxpayers’ payroll taxes. Likewise, you need an EIN number to be able to pay taxes to the state in which you are registered.
To obtain an EIN, you can apply through the IRS website, by filling out the SS-4 form, or by phone. However, before EIN application, you need to prepare a lot of information such as the name, address, area of activity of your company, and the reason for applying. You can consult an accounting professional or ask them to apply on your behalf to make sure you are filing the application correctly.
What are the Difference between EIN and ITIN?
Before explaining the differences between EIN and ITIN, let’s say this about EIN: In short, EIN is a commercial tax identification number defined by the IRS for legal entities and individual business activities in the United States.
In the United States, there are many identification numbers used to identify individuals and companies. Social Security Number, which can be considered as equivalent to the Republic of Turkey Identity Number in our country, and many other identities such as driver’s license, passport number are valid in the USA as well as in our country.
Again, two other important numbers that are most common among these identification numbers and often confused by those who are not familiar with the subject are ITIN and EIN numbers. The employer identification number, which is the subject of this content, is obtained through the EIN application process.
EIN, which is an Employer Tax Identification Number
The employer tax identification number, EIN, is issued by the American Taxation Office (IRS) and is used in the taxation of companies. In its most basic features, this tax identification number is necessary for companies to operate legally in the USA, to open company-owned bank accounts, to recruit new employees, and to make company-related payments. This tax identification number, obtained through the EIN application process, can be considered as a corporate social security number in a sense.
ITIN, which is an Individual Taxpayer Identification Number
An ITIN is an identification number that only certain non-US citizens can obtain. The ITIN is a mandatory tax identification number for most people who want to start a business in the USA. This may be necessary even if the person does not live in the United States. The requirement here is whether the person is required to file the necessary tax-related paperwork to the IRS. If such a tax declaration is required, an ITIN is also required.
It is worth mentioning again; The ITIN is a mandatory identification number for anyone filing a tax return with the IRS, regardless of immigration status. To obtain both numbers, you can apply to the agencies that provide services in this regard.
How to Get EIN Number?
There are agencies that will help you get a Federal Tax Identification – EIN number from the IRS for your company at a very affordable price. With these easy and fast services, you will avoid confusing IRS forms and procedures and benefit from professional customer support. For this, you can get information about the fee from the agencies. You will receive the Federal Tax Identification number between 2-3 weeks after the EIN application.