Tax
EIN
Also known as Employer Identification Number, Federal Tax ID
An EIN, or Employer Identification Number, is a nine-digit federal tax identification number the IRS issues to a business. An EIN is required to open a US business bank account, onboard with payment processors, hire employees and file federal returns. The IRS issues EINs free of charge.
In plain terms: Your company's tax number. Free from the IRS, and almost everything asks for it.
Why it matters
The EIN is the bottleneck for founders without a Social Security Number, because the IRS online application requires an SSN or ITIN. Without one you file Form SS-4 by fax or mail and wait weeks. Since banking and payment processing both depend on it, apply the day the entity exists.
Example
A Wyoming LLC is formed on Monday. The owner, who lives in Pakistan, faxes Form SS-4 on Tuesday with 'Foreign' on line 7b, and waits for the EIN before applying for a bank account.
Common misunderstanding
That you need an ITIN first. You do not — Form SS-4 provides for a responsible party with no US tax ID.
Read the full guideEIN and ITINRelated terms
Source: IRS — Employer ID Numbers. This is a definition, not tax or legal advice — verify against the primary source before acting.