An employer identification number (EIN) is issued by the IRS and serves as a way for a business to be legally recognized. In addition to this an EIN serves as the identification required to obtain a business loan, open an account or to apply for state and federal licensing.

Once an EIN has been obtained, an individual or corporation is then able to file for a transaction privilege tax (sales tax) in their state of residence.

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Who is Required to Obtain an Employer Identification Number?

The IRS requires the following entities to have an EIC:

  • Employers
  • Sole Proprietors
  • Corporations
  • Partnerships
  • Non-Profit Associations
  • Trusts
  • LLC
  • Estates of Decedents
  • Government Agencies
  • Certain Individuals
  • Other Business Entities

In addition to this, the IRS lists several questions that if answered yes, an Employer Identification Number is required.

How Do I Obtain an Employer Identification Number?

To obtain an EIN, an application must be filed by the “responsible party” who has access to all necessary information which needs to be prepared before an application is started. The responsible party is only allowed one application attempt per day and the application must be filled out and submitted in one session as the application cannot be saved to be finished at a later date.

The IRS defines the “responsible party” as: “all EIN applications (mail, fax, electronic) must disclose the name and Taxpayer Identification Number (SSN, ITIN, or EIN) of the true principal officer, general partner, grantor, owner or trustor. This individual or entity, which the IRS will call the “responsible party,” controls, manages, or directs the applicant entity and the disposition of its funds and assets”.

If the principal place of business, office, agency or responsible party is in the United States, an EIN may be obtained by:

  • Online: Filling for an EIN online is the preferred method for both the IRS and individuals as once the application has been submitted an EIN is issued. This means that the EIN is obtained immediately after an application is completed and there is no wait time to save or print an EIN assignment notice
  • Fax: Responsible parties can fax the completed Form SS-4 and will receive an EIN within 4 business days
  • Mail: Responsible parties can mail their completed Form SS-4 to the address listed on the form, and an EIN will be mailed back within 4-5 weeks

If the principal place of business, office, agency or responsible party is not located in the United States, an EIN may be obtained by:

  • By Fax: follow the same process listed above
  • By Phone: call 267-941-1099 (not a toll-free number) 6 a.m. to 11 p.m. (Eastern time) Monday through Friday to obtain an EIN. You must be authorized to receive the EIN and answer questions concerning the Form SS-4

How Much Does it Cost to Get an Employer Identification Number?

Unlike other applications that are required when creating a business, obtaining an EIN is free through the IRS’s website. Using a third party’s online service to complete the EIN application is not free and third parties will often mislead individuals into believing that there are fees required to obtain an EIN.

How Long Will it Take to Obtain an Employer Identification Number?

The quickest way for a required entity to obtain an EIC is to apply online through the IRS’s website. Applying online allows the responsible party upon completion of their application to immediately receive and print their EIN for use.

If an individual or corporations files for an EIN by fax or email, they will wait for anywhere from 4 days to 5 weeks.

What to Do if You Can’t Locate Your Employer Identification Number?

The IRS recommends that individuals who have lost or misplaced the EIN for their business follow these steps:

  • Find the computer-generated notice that was issued by the IRS when applying for your EIN. The notice was issued as a confirmation of your application for, and receipt of obtaining an EIN.
  • If you used your EIN to apply for a loan, or any state/local licensure, the EIN accompanied the required documents for these activities and either the bank or agency can obtain the information for you.
  • Look for your EIN on previous tax returns.
  • The responsible party may call the IRS for their EIN by calling the Business & Specialty Tax Line at 800-829-4933.

Are federal Employer Identification Number Numbers Public Record?

Employer identification numbers are considered to be a public record however, they are similar in nature to a social security number and due to this, companies will not make their EIN readily available to the public. This means that in order to protect themselves from identity theft, companies will not post their EIN on their website or on regular correspondence.

Certain circumstances will warrant the need to obtain the EIN of another company in order to perform basic business transactions, and therefore an EIN can be obtained in one of the following ways:

  • Contact the business directly
  • If it is a large company and an invoice is being sent to them, contact their accounts payable department
  • If you have received an invoice from the company, ask to speak with their accounts receivable department
  • Use the SEC Edgar search

The quickest way to obtain the EIN for another company is to either call or visit them in person if it is a small business. There are other ways to obtain an EIN such as using internet searches, however in the state of Arizona it can be difficult to obtain the EIN of another company online.

The process of forming a business is often daunting due to the exorbitant amount of paperwork needing to be filed, and failure to correctly file the correct documents can lead to fines and possibly the loss of your business. If you are unsure about any of the steps needing to be taken to ensure your business is in good legal standing with the state, a legal expert can assist you.

 

Call JacksonWhite’s Small Business Law Team at (480) 464-1111 to discuss your case today.

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