What is an EIN and why do you need one?

EIN stands for Employer Identification Number which is a tax number for your LLC and is used to identify a business entity in the US.

An Employer Identification Number (EIN) is a unique 9-digit tax identification number assigned by the Internal Revenue Service (IRS) for your LLC and a requirement of many US banks & institutions (such as the IRS) to carry out business in the US.

Once your EIN is acquired, you can apply for US business bank accounts and US payment gateways. The IRS (Internal Revenue Service) uses EINs to track how and when companies report their taxes.

Uses of the EIN: As a business owner, it allows you to -

• Open business bank accounts. Almost all financial providers require EINs.
• Easily file tax returns for your business
• Used for account registrations for Amazon FBA, eBay, Youtube, Google Adsense, Paypal, Shopify, Stripe, and many more.
• Separate your personal and business affairs by keeping your SSN private (if you have one) and exclusively using the EIN for business activities
• Acquire certain business permits, if required for your business.
• Streamline the business loan or line of the credit application process

There are 2 methods to apply for an EIN - Online and through Mail/Fax

When can I apply for an EIN online?

In order to apply for an EIN online, the person applying must have a SSN (Social Security Number) or an ITIN (Individual Taxpayer Identification Number).

If you have an EIN or an ITIN, you can apply for your own EIN from here: https://sa.www4.irs.gov/modiein/individual/index.jsp

If you don’t have an SSN or ITIN (which international founders might not have), then you have to mail or fax the SS-4 application in to get an EIN for your US company.

Instructions and form to fill out the SS-4 application here: https://www.irs.gov/forms-pubs/about-form-ss-4

Getting an EIN through mail/fax takes longer than generating it online.