In this content, let’s talk about the differences between EIN and ITIN numbers within the scope of ITIN application. EIN and ITIN are numbers given to individuals by tax authorities. In addition, it is of great importance as these people have the numbers they use in the transaction when making tax refunds.
Taxpayer identification number or ITIN is a general term used by the IRS. In addition to this, there are different types of numbers given to people depending on one’s occupation. An EIN is one such number requested by business owners who employ workers. This is known as the employer identification number. It also serves the purpose of the identification number when filing tax returns.
In the United States, there are identification numbers that individuals use. There are many identification numbers used to identify companies. According to ITIN application subject, we can say that: Turkey’s ‘identification number’ is equivalent to ‘social security number’ in the USA. In addition, many other identities such as driver’s license and passport number are valid in the USA, just like in Turkey.
There are two tax numbers that you come across the most among the identification numbers for the USA. Also, if you are not familiar with the subject, you can often confuse these two numbers. These two numbers are ITIN and EIN.
The Difference between ITIN and EIN
- An ITIN number is an identification number that can be obtained by ITIN application and by certain non-US citizens.
- The employer tax identification number, EIN, is used in transactions related to the taxation of companies.
- The ITIN is a tax ID number you must obtain if you want to establish a company in the USA. The ITIN may be required for you even if you do not live in the USA. The criterion here is whether you have to file a tax return with the IRS. If you need to make a tax declaration in this way, you must obtain an ITIN.
- At its most basic, EIN, this tax identification number enables companies to operate lawfully in the United States. Namely, this number is required in order to open bank accounts belonging to your company. Also, in order to recruit new employees to your company, you have to get an EIN number by EIN application. In addition, an EIN is required in order to make payments to your company.
ITIN and EIN Numbers
Let’s give a good example of why you should get the ITIN number. For example; your company has revenues, profits or losses originating from the USA. In addition, these amounts are traded through your company members or shareholders. In this case, you as the owner of the company will need to obtain an ITIN. Depending to ITIN application you have to file a tax return to the IRS organization.
In short, EIN is the commercial tax identification number defined by the IRS for legal entities and individual commercial activities in the United States. You can think of this number obtained with this EIN application as the Social Security Number of companies.
All Your Questions about the ITIN Application Process
As a result; in this content, we explained the differences between ITIN and EIN in the most understandable way. However, you can apply to professional consulting firms to obtain both numbers.
If you want to establish a company in the USA, consulting firms can fill out an application form. In addition, if you have any questions, you can easily reach consultancy firms working with a professional team. Thus, you will receive clear answers to all your questions about the ITIN application process or EIN.