What Is an EIN?
An Employer Identification Number, or EIN, is a nine-digit number the Internal Revenue Service assigns to identify a business for federal tax purposes. It appears on tax returns, bank applications and tax forms you give to payment platforms.
What an EIN is used for
Businesses use an EIN to file tax returns, hire employees, open business bank accounts and apply for some licenses. LLCs and corporations almost always need one. Some sole proprietors with no employees can use their Social Security number instead, though banks and platforms may still ask for an EIN.
It is free
The IRS says you never have to pay a fee for an EIN and warns against websites that charge for it. Apply only through the IRS website, or by phone, fax or mail where the IRS says that applies, for example for applicants whose principal place of business is outside the US.
How it differs from other numbers
An EIN identifies a business. A Social Security number identifies a person. An ITIN is a tax identification number for certain people who must file US taxes and cannot get a Social Security number. A state tax ID or sales tax permit comes from a state, not from the IRS.
An example
A student forms an LLC, applies to the IRS for an EIN and then uses the number to open a business bank account and to complete the tax form a marketplace requests.
Related terms
See limited liability company, sole proprietorship and registered agent. For the steps, read our guide on how to get an EIN.
Frequently asked questions
Does an EIN cost money?
No. The IRS charges nothing for an EIN. Be wary of sites that charge a fee to file the form for you.
Is an EIN the same as a tax ID?
It is one kind of tax identification number, used for businesses. Individuals use a Social Security number or an ITIN, and states may issue their own numbers.
Can I apply from outside the US?
The IRS says the online tool is for US-based entities and applicants with a principal place of business outside the US apply by phone, fax or mail.