One of the key responsibilities for many new businesses or businesses that are restructuring is obtaining an Employer Identification Number (EIN) from the IRS.
An EIN is a unique nine-digit number that identifies your business for tax purposes. It’s like a Social Security number but is meant for business related items only.
An EIN can be used to open a business bank account, file your tax returns, and, in some instances, apply for business licenses. It’s helpful to apply for one as soon as you start planning your business. This will ensure there are no delays in getting the appropriate licenses or financing that you may need to operate.
Who Needs an EIN?
An EIN is needed by any business that retains employees. However, non-employers are also required to obtain one if they operate as a corporation or partnership. Sole proprietors are not required to obtain an EIN.
Not sure whether you need an EIN? Review this guide from the IRS. If you answer yes to any of the questions in the list, you need to apply for an EIN.
* This information is taken from https://www.sba.gov/
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