If you’re starting a business, you’ll need to apply for a Tax Identification Number (TIN), also known as an Employer Identification Number (EIN). A TIN is used by the IRS to identify your business and can be crucial for opening a bank account, filing taxes, hiring employees, and more. Here’s your ultimate guide on how to get a tax ID number.
What Is a Tax ID Number?
A tax ID number is a nine-digit identification number that the Internal Revenue Service assigns to businesses for tax purposes. It is used by the IRS to track activity related to your business entity.
Types of TINs
There are several types of tax identification numbers available depending on what type of entity you are registering:
– EIN: Businesses with employees or those that operate as partnership corporations.
– ITIN: Individual Taxpayer Identification Numbers assigned by the IRS for non-resident aliens who are required to file US income returns.
– SSN: Social Security Numbers available only for sole proprietors.
Steps To Obtain A TIN
Here’s what you need to do in order obtain an EIN:
- Determine If You Need an EIN
Not all businesses require an EIN – see this taxation guide from IRS which details when one is needed.
- Apply Online
The easiest way is through applying online using the IRS Website portal. The application process will take around 20 minutes.
- Apply By Mail Or Fax
You may also fill out Form SS4 Application for Employee Identification Number and send it via mail or fax identified in their website.
4.Use Third-party Service
Third-party services streamline the process by handling all of the paperwork for you. Companies like LegalZoom can help you complete your EIN application quickly and easily.
Final Thoughts
Getting a TIN might feel overwhelming at first, but it’s actually a relatively straightforward process. By following these steps, you can get your tax ID number in no time and be on your way to running your business!
FAQs
Sure, here are three popular FAQs about how to get a tax ID number and their answers:
What is a Tax ID Number (TIN), and why do I need one?
Answer: A Tax ID Number (TIN) is a unique identifier assigned by the Internal Revenue Service (IRS) to businesses or individuals for tax purposes. It can be used for various reasons, such as filing tax returns, opening bank accounts, applying for loans or credit cards, hiring employees, and more. If you plan to start a business, work as an independent contractor, or earn any income that may be subject to taxes in the United States, you will need at least one TIN.
How can I apply for a Tax ID Number (TIN)?
Answer: There are several ways to apply for a TIN depending on your situation. If you’re starting a new business entity in the US, such as an LLC or corporation or making changes to your existing business structure like converting from sole proprietorship to LLC then you should file Form SS-4 with IRS either online via their website or by mail/ faxing it Once submitted electronically IRS issues EIN within hours time while postal applications may take 7-14 days processing time.. Alternatively if don’t have SSN but still need an EIN then organization has related individual who must be authorized person and he/she can prepare Form SS-4 on behalf of organization.
Can non-US residents without Social Security Numbers (SSNs) get TINs?
Answer: Yes; non-US residents who do not have Social Security Numbers can obtain individual taxpayer identification numbers instead of TINS.It requires completion of form W-7 i.e application(available in PDF format at irs.gov site). When submitting the W7 application form it needs specific documentation which proves identity.
Once accepted by IRS applicant will receive Individual taxpayer identification number in about 6-10 weeks.
