What Does EIN Mean and How To Apply for One (With FAQs)

By Robert Preston

Updated July 27, 2022 | Published September 15, 2021

Updated July 27, 2022

Published September 15, 2021

Robert Preston is a trained journalist with a deep interest in technology. He has been passionate about and studied coding for over 20 years.

The federal government has several requirements for businesses to operate legally in the United States. One of these requirements is obtaining an employer identification number (EIN) from the Internal Revenue Service. Learning about EINs and how to apply for them may help businesses remain compliant with federal guidelines. 

In this article, we discuss what EIN means, describe who uses it, explain the difference between it and a tax identification number, provide four ways to apply for one and answer some common questions about the application process.

What does EIN mean?

An EIN, or employer identification number, is a nine-digit number business entities receive to help identify them. The IRS issues these numbers so businesses can use them to file payroll tax returns.

Federal law requires all employers operating a U.S.-based business or entity to obtain an EIN from the IRS before January 1 of the first year in which they plan to employ staff. Although a company’s EIN remains the same in all states, some states may require businesses to apply for a state identification number.

Related: What Is an Employer Identification Number? (With FAQs)

Who uses an EIN?

When managing a business or organization, it’s important to know your tax responsibilities. To determine if a business requires an EIN, you can ask these questions:

  • Does the organization have employees?

  • Is the business a partnership or corporation?

  • Do you or the business file tax returns for alcohol, tobacco, firearms, excise or employment?

  • Do you withhold taxes on income you pay to a nonresident other than their wages?

  • Do you use a Keogh pension plan for retirement planning?

If you or the company does any of these, the organization needs an EIN. Regulations also say a company needs an EIN if it’s involved with estates, farmers’ cooperatives, nonprofit organizations, plan administrators, real estate mortgage conduits or certain trusts.

Related: Understanding Your W-2 Form: Wage and Tax Statement

EIN vs. TIN

A tax identification number (TIN) is a classification the government gives to one of several types of identification numbers an individual or business uses when filing tax information. All EINs are TINs, but there are other types of TINs, including: 

  • Adoption taxpayer identification number (ATIN)

  • Individual taxpayer identification number (ITIN)

  • Preparer taxpayer identification number (PTIN)

  • Social security number (SSN)

Related: Information Forms for New Employees

4 ways to apply for an EIN

There are a few ways businesses can apply for an EIN. Before applying, a business must meet certain requirements. For example, it should have a physical location in the United States. The business can be an incorporated company, or it can be an individual who owns a business. The business’s owner also must control the daily operations of the company to apply for an EIN. After ensuring it meets the requirements, a business can apply for an EIN in one of these ways:

1. Apply online

Online applications for an EIN offer businesses a fast way to register for an identification number. The IRS requests certain information, including the name of the business, the type of business and payroll tax returns you intend to file that year, during the registration process. If you're interested in applying for an EIN online, you can do so on the IRS website.

Related: W-4 vs. W-9: What's the Difference? (With FAQs)

2. Apply by telephone

International applicants have the option to apply for their EIN by phone if they call a toll-free number. The IRS staffs phones from 6 a.m. to 11 p.m. Eastern from Monday to Friday. If the caller doesn’t have authorization to answer questions and receive an EIN on behalf of the company, the business owner may fill out a third-party designee to authorize them to temporarily act as an authorized representative during the call. 

Related: How To Get Your W-2 From a Previous Employer: Steps and Tips

3. Apply using an authorized IRS e-file provider

Some external companies allow businesses to complete and file payroll tax returns online for a fee. The external company assists the business in obtaining an EIN, which they receive through the mail. They also often offer some services similar to what the IRS offers online, such as filing through an application portal.

Related: How To Fill Out a W-9 Form in 3 Steps (With Tips)

4. Apply using standard mail 

Businesses can obtain an EIN by completing an application package and mailing it to the IRS. When they complete the application and include all required documentation, the IRS may be able to issue an EIN within six weeks. You also can find the address information for mail-in applications on the IRS website.

Related: A Step-by-Step Guide to Payroll Processing (With Tips)

Frequently asked questions about employer identification numbers

Here are the answers to some common questions about employer identifications numbers and the application process:

Where do I find my employer's EIN?

You can find your employer's EIN on the "Employer ID" section of a W-2 form. You can find this on the last page of the W-2 under "Other Entering Data." Many organizations list their EIN publicly, which allows you to find it by searching for it on a search engine.

Related: FAQ: What Is an Employer?

Is there a fee for obtaining an EIN?

Businesses may pay a small fee to the state in which they’re applying for an EIN, but there’s no federal fee for one. You can find out more about state fees by contacting your state's department of workforce development. Some states charge a fee for online applications or may have online application forms that have additional fees.

Related: When Do You Need a 1099 Form and Where Do You Get One?

How long does it take for a business to receive its EIN?

Businesses often receive an email notification within 24 hours of submitting their application and all required documentation. Once you complete the application, the IRS mails the EIN within six weeks. If your application doesn’t have the required information, it may take an additional four to six weeks to process and complete.

This article is for information purposes only and is not intended to constitute legal advice; you should consult with an attorney for any legal issues you may be experiencing.

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