All About EINs - The Why, When, & How

What's an EIN?

EIN stands for Employer Identification Number. It's essentially your business's social security number. You use it to identify the business.

When Must You Have an EIN

According to the IRS website, you need to have an EIN if you operate as a corporation or if you have employees.

When Should You Have an EIN

I say always. Getting your EIN is super easy. It takes about 5-10 minutes, and it's free. You will need an EIN to open your bank account, and as a sole proprietor or single member LLC owner, you can use your EIN in place of your social security for important documents like W-9s. That means, in short, that you don't need to give your social to strangers.

What Not to Do

Don't pay someone to get your EIN for you unless it's bundled into a full service package. It's super easy. Just Google IRS EIN application and do it for free through their site.

Other Licenses

EINs are just one of many applications you need to complete to get your business legit. For a more comprehensive list, check out this blog.