Obtaining an Employer Identification Number
Obtaining an employer identification number is one of the most frequent activities a business owner must complete. There are several conditions that must be met in order to apply for an employer identification number, or an EIN. The employer identification number is how the Internal Revenue Service, or IRS, recognizes a business as a tax paying entity. The employer identification number will be necessary when the business goes to register itself, to file for business licenses and permits, to register a DBA or "doing business as" name, and for many other functions as well. There are several different ways that a new business owner can apply for an employer identification number to obtain a number quickly.
When to Apply for an Employer Identification Number
Common situations that require a business owner to register for an employer identification number include when starting a new business, when beginning to hire employees, when opening a savings or checking account on the business's behalf, when a business has changed ownership such as when a business is newly purchased, or when a partnership or corporation has formed. If you are unsure whether your business is required to register for an employer identification number, the best way to find out is to contact the local county clerk's office, or alternately you can contact the IRS directly to ask your question.
How to Apply for an Employer Identification Number
To apply for an employer identification number, you will need to fill out what is called a Form SS-4. This form is available for download or electronic completion on the IRS website at irs.gov. There are a number of ways you can complete your Form SS-4. The IRS allows business owners to register for an employer identification number via the Internet, telephone, fax, or by snail mail. Response times can vary, with the shortest response time coming from an online application, and the longest response time, which can often be longer than four weeks from date of application, coming from a snail mail application. Whatever method by which you choose to apply, you should be prepared to receive the IRS' response back by that same means. The IRS also puts limits on how many employer identification numbers any one business owner can apply for in any given day with the current limit being five numbers per day. So if you have several businesses in need of an employer identification number, it can be important to budget your time accordingly to avoid getting into hot water with other applications or licenses that need to be processed and are waiting for an employer identification number to be submitted.
What to Expect Once You Have Applied for an Employer Identification Number
Depending on your chosen method of application, you will likely receive a response from the IRS in two to four weeks. If the IRS needs further information they will contact you to ask for it.
