How to Obtain an Employer Identification Number (EIN) for Your Business

May-28-2025

Starting a business is like embarking on an exciting journey, but it comes with a checklist of crucial steps to keep everything on track. One of the key steps is getting an Employer Identification Number, or EIN. While it might not be as flashy as your business name or logo, it’s just as important. Think of an EIN as the business equivalent of a Social Security Number; it’s a unique nine-digit code given by the IRS to identify your company for tax purposes. Whether you’re kicking off a new venture, bringing on employees, or just need a business checking account, securing an EIN is a must-do.

In the rest of this blog, we will break down what an EIN is, why you need one, when to get it, how to obtain it, and how to make the most of it once you have it.

What is Employer Identification Number or EIN, and Why Is It Essential for Your Business?

If we consider it in simpler words, you can say EIN or Employer Identification Number is just a method of the IRS to track your business for tax-related or legal purposes. It helps separate your finances from your business finances, which is vital when you’re running a company. This unique number lets the IRS identify your business and makes sure you’re meeting your tax obligations properly.

If you're wondering whether or not you need an EIN, here are some standard situations where you'll need it:

Hiring Employees:

If you plan on hiring employees, an EIN is required for reporting payroll taxes.

Corporation or Partnership:

These businesses must get an EIN to report tax returns.

Filing Special Tax Returns:

If your business has employment taxes, excise taxes, or sells products regulated like alcohol or tobacco, you'll need an EIN.

Business Bank Account Opening:

Almost all banks won't open a business account for you without an EIN.

Business Licenses or Permits:

Some licenses ask for your EIN as part of the process.

If your business description does contain the above, it's clear you're going to need an EIN to be in compliance and avoid any legal troubles.

When Should You Apply for an EIN?

Time your EIN application carefully. It's best to apply for your EIN as soon as possible once you form your business. Here are some specific instances when you should get your EIN:

Soon after establishing a new business organization:

If it's an LLC, corporation, or partnership, get your EIN shortly to carry on the momentum.

Before you start employing staff:

Don't wait until pay day to have your EIN. Having it at hand in advance makes it easy to establish payroll.

When you open a business bank account:

Since most banks request an EIN, having it on hand makes opening accounts without delay unnecessary.

Before filing certain taxes:

If you're required to file employment or excise taxes, get your EIN first.

Holding up too long slows your operations or results in compliance problems, so it's a good idea to get your EIN early in establishing your business.

How to Apply for an EIN

It's easy to obtain your EIN from the IRS. You have various options to apply, depending on your situation and preference.

1. Online Application

The most efficient and fastest method is applying via the IRS website online. You'll complete the application in one session and receive your EIN immediately after submitting it.

Gather the following information before you start:

Your business type (LLC, corporation, sole proprietorship, etc.)

Business legal name

The name and Social Security Number or ITIN of the business owner (usually the owner or principal officer)

Your business address and phone number

Keep in mind the internet application is open Monday through Friday from 7 a.m. to 10 p.m. Eastern Time. You must fill out the form in one sitting since you can't save and return later. The session will time out if there is greater than 15 minutes of inactivity, so you should have everything ready ahead of time.

2. Apply by Fax

If online is not an option for you, you can fill out Form SS-4, Application for Employer Identification Number, and fax it to the IRS at 855-641-6935. Get an EIN now, free, direct from the IRS.

3. Apply by Mail

You can also mail in your completed Form SS-4 to the IRS. This takes the most time and takes four weeks to process.

4. Call to Apply by Phone (Foreign Applicants Only)

If your company is outside the United States, you may just call the IRS at 267-941-1099 to get your EIN. The phone numbers are open Monday through Friday, 6 a.m. to 11 p.m. Eastern Time.

What to Do After You Get Your EIN

Once you get your EIN, your business is now officially established by the IRS for tax purposes. This opens up numerous opportunities like:

Establishing a business bank account

Hiring employees and processing payroll

Getting business licenses

Filing taxes

Managing payroll can get complicated quickly, especially when you’re new to it. That’s why many businesses turn to payroll service providers. For example, PayProNext offers a reliable payroll solution that takes care of all the heavy lifting, from calculating employee wages to filing taxes on your behalf.

Why Use PayProNext for Payroll?

Proper management of payroll is critical; one error can lead to taxes or fine penalties. PayProNext helps business owners with:

Figures paychecks, deductions, and taxes for you.

Keeps you up to date on federal and state tax regulations.

Protects sensitive payroll data through strong encryption.

Help you review payroll costs and keep a record.

With a payroll service like PayProNext, you'll be able to worry less about payroll data and worry more about developing your business.

Final Thoughts

Getting an EIN is a necessary step in starting a business. It's free, easy, and a requirement by the IRS for all business activities. The easiest way is to do it online and get your EIN immediately. With your EIN in hand, you're ready to handle payroll, open bank accounts, and file your taxes correctly.

Having a good payroll provider like PayProNext can make handling employee compensation and tax reporting easier. One fewer worry while growing your business.

Starting a business takes dedication and planning. Pre-arranging for your EIN is the smart thing to do that secures your foundation for success.