EINs Explained: What They Are and How to Get One

If you’re an entrepreneur launching your own business, you may have come across the term “EIN number” while doing research. EIN stands for “Employee Identification Number”, so “EIN number” is technically incorrect, as it’s redundant. Now you know how to use the term in a sentence, but what exactly does it mean?

An EIN is a tax identification number that’s required for most U.S.-based businesses. Even though you don’t legally need an EIN, it can be beneficial to apply for one. This number allows companies to complete important tasks like filing certain tax returns, setting up a 401(k), and even hiring employees. Operating without an EIN is possible, but your growth will be significantly limited.

It’s completely free to obtain an EIN, but you’ll need quite a bit of information about your company before beginning your application. In this guide, we’ll explain what an EIN is, how to apply for one, who needs one, and the ways this number can help you grow your business. We’ll also take a look at how an EIN unlocks access to Slash, a business banking platform that doesn’t require a credit check or social security number to join.¹

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What is an EIN?

An Employer Identification Number (EIN), also known as a Federal Tax Identification Number (FTIN) or Federal Employer Identification number (FEIN), is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to identify your business for tax purposes. Each EIN follows a XX-XXXXXXX format, such as 12-3456789.

Think of an EIN as your business's Social Security number. Just as U.S.-based individuals often use SSNs for tax filing and financial accounts, businesses use EINs to:

Open business bank accounts: Financial institutions often require an EIN to set up business checking accounts and access corporate cards, as the number helps verify your identity. While some corporate cards pull your credit and come with a personal guarantee, the Slash Visa® Platinum Card only requests an applicant’s EIN.
File federal and state tax returns: You’ll need to include your EIN on just about every tax return you can fill out as a business, such as income and payroll tax returns.
Apply for business licenses and permits: The EIN is an important identifier when applying for most federal licenses and industry-specific permits.
Hire employees and set up payroll: When reporting wages and withholding taxes, you’ll need to include your EIN on your W-2s and/or your Form 941s.

The IRS assigns each EIN to a specific business entity, and this number stays with your business throughout its lifetime. You cannot transfer an EIN to another business, and you won’t need a new EIN when expanding or renaming your business. The only scenarios that call for a new EIN are a change in ownership structure (e.g. shifting from an LLC to a corporation) or the creation of a new entity that’s legally distinct from your current one.

As you navigate through the process of opening your business, you’ll likely encounter other numbers and acronyms that seem similar to the EIN. For example, there’s the TIN (Taxpayer Identification Number), which is a broader term for any identification that the IRS uses to track employees. Your EIN is a type of TIN.

Another similar code is the DUNS number, which is a 9 digit identifier assigned and maintained by Dun & Bradstreet. Unlike the EIN, it’s used to establish commercial credit, and is often required for lending, partnerships, and government contracts. Your EIN, DUNS number, and social security number can all be important as you form a new business, so it’s smart to make sure you know each one and what you’ll need them for.

Who Needs an EIN and Why?

The IRS requires an EIN for the majority of businesses, dependent on their structure and activity. Here’s a rundown of who needs an EIN:

Corporations: All corporations, including S-Corps and C-Corps, must have an EIN regardless of size or employee count.
Partnerships: Business partnerships need an EIN for tax filing purposes.
LLCs: LLCs specifically need an EIN when they have multiple members.
Businesses that file certain taxes: If you file employment taxes, excise taxes, or Alcohol, Tobacco, and Firearms (ATF) tax returns, an EIN is required.
Businesses that manage trusts, estates, or retirement plans: Entities that manage the property of other individuals under these structures will need an EIN to clarify separation from the clients involved.
Businesses with employees: No matter what, if you have even one employee, you need an EIN for payroll tax reporting and withholding.

That list may seem quite comprehensive, but there are still a couple business entities that don’t require an EIN to form. Sole proprietors and single-member LLCs that don’t hire employees can use their SSN instead of their EIN on their tax returns, meaning an EIN is not legally necessary. While businesses that form as corporations can also function without employees, they’ll still need an EIN due to their structure.

Key Benefits of Having an EIN

Even if your business doesn’t technically need one, obtaining an EIN can provide several advantages beyond simple tax compliance. Here are some reasons EINs can be helpful:

Separating your finances

An EIN helps keep your personal finances separate from your business finances, which can provide greater liability protection. Similarly, an EIN helps establish business credit that’s separate from your personal credit history, meaning any issues that arise within your company won’t affect your personal credit score. Using your EIN instead of your SSN on your documents can also help safeguard you against identity theft.

Professional credibility

Your prospective vendors and clients may view businesses with EINs as more established and legitimate. EINs can also be important when applying for loans, credit lines, and financing, as banks and credit agencies often check EIN credit history before making lending decisions.

Banking requirements

Having a business bank account can help you apply for loans and access rewards-filled corporate cards. Some modern banking platforms, such as Slash, also offer integrated dashboards that provide automation tools and real-time visibility into cash flow. An EIN is almost always required in order to open these types of bank accounts, even if you’re the owner of a single-member structure that wouldn’t otherwise need one.

International business operations

If your business routinely imports or exports goods across borders, an EIN is often required when applying for necessary international licenses and permits. EINs are also necessary to claim certain tax benefits that may apply to your business’s global operations. For example, the United States has tax treaties with some countries that negate double taxation. That means that U.S. business owners who earn money in these countries won’t have to fill out two sets of income taxes.

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How to Apply for an EIN: Step-by-Step Guide

Unlike many business-related legal procedures, it’s completely free to apply for an EIN. The IRS offers several application methods, but the online route tends to be the fastest and most convenient option for most people. No matter which avenue you choose, you’ll need to be armed with a lot of information about your business, including your:

Business’s legal name and any trade names or DBA (Doing Business As)
Business address (the principal address cannot be a P.O. Box)
Responsible party information, including full name, SSN or Individual Taxpayer Identification Number (ITIN), and address
Business structure
Reason for application (Starting a new business, hiring employees, opening a bank account, etc.)
Business start date or acquisition date
Principal business activity and brief description of your business

While most of these details are simple, it’s smart to prepare a description of your business activity ahead of time, especially if you’re applying over the phone.

How to apply for an EIN online

Here are the steps to apply through the IRS website:

Visit the official IRS website and find the EIN application form under, “Get an employer identification number”.
Complete the online SS-4 form with your business information
Double check that all information is correct and that you’re satisfied with your business description
Receive your EIN within minutes of your submission
Download and save your EIN confirmation letter for your records

The online system is available Monday through Friday, 7 a.m. to 10 p.m. Eastern Time. Users are also limited to one EIN application per day, which could be something to be mindful of if you’re creating multiple connected entities.

Alternative Application Methods

If you cannot use the online system, the IRS allows users to apply via phone, mail, or fax. To apply by phone, call the IRS Business & Specialty Tax Line at 1-800-829-4933 during business hours. After providing the necessary personal and business information, you’ll receive your EIN during the call. International applicants can follow the same process by calling 1-267- 941-1099.

To apply by mail or fax, you’ll need to complete Form SS-4 and mail it to the address specified in the form instructions, or send it to your state’s fax number. Processing takes 4-5 business days by fax, and can take up to 4-5 weeks by mail.

What to Do After Getting Your EIN

Once you receive your EIN, you should take steps to properly protect it just as you do (hopefully) with your SSN. It’s smart to store your EIN confirmation letter in a secure location, keep the number itself on an encrypted app, and only share it with legitimate business partners, banks, and government agencies.

Now that your number is secure, it’s finally time to use it. New business owners will typically need to provide their EIN when opening a business bank account, beginning vendor relationships, applying for certain licenses, and more. While these are largely steps you’ll only take in the early stages of your company’s life cycle, you’ll consistently need to include your EIN on every tax return as long as you own your business.

You’ll also need your EIN to report changes to your business via form 8822-B. This form must be filled out when changing your business’s mailing address, operating location, or responsible party. However, minor updates like location and owner do not entail a change in your EIN itself. You’ll only need a new EIN if you change your business structure or in certain circumstances involving an acquisition or purchase.

How You Can Use Your EIN to Open a Slash Account

As you form your own company, you may find that you need your social security number almost as often as you need your employee identification number. Most business bank accounts require your SSN, EIN, and other business documentation. With a request for your SSN, these banking platforms restrict access to international founders and can blur the line between your personal liability and your business liability. That’s why Slash’s application is EIN-only.

Slash is a neobank that doesn’t ask their applicants for their SSN or pull their credit history. All you need to apply is your EIN and relevant documentation that demonstrates operating activity. Once your application is approved, you get instant access to an all-in-one banking platform that supports diverse payment rails, automates accounting and invoicing tasks, and comes with an AI agent named Twin.

Twin is an AI-powered financial assistant that works alongside your team to automate workflows and analyze insights. Using natural language, you can ask Twin to break down your spending patterns, compare trends, look into technical issues, and even place orders for goods and services on your behalf.

You’ll also get the Slash Visa® Platinum Card, a corporate charge card that gives users up to 2% cash back on every business purchase. Users can create unlimited virtual Slash cards and configure them with specific spending ceilings, category restrictions, and team access. Each transaction made with a Slash card is visible in real time on our integrated financial dashboard. If suspicious activity is detected by our AI-powered security tools, Slash admins can get instant alerts that enable them to freeze the card before further misuse can occur.

Other helpful Slash features include:

Cryptocurrency payments: With built-in on/off ramps, businesses can send and receive USD-pegged stablecoins like USDC and USDT.⁴ This allows companies to access potential benefits like faster settlement and lower processing costs, while avoiding the price volatility associated with many other cryptocurrencies.
Global USD: The Slash Global USD Account is designed as an alternative for foreign founders who want access to USD without forming a US entity.³ Balances are backed by Slash’s USDSL stablecoin, which is matched one-to-one in value with the US dollar.
Accounting integrations: Automatically sync transaction data with QuickBooks Online, Xero, and Sage Intacct for simplified reconciliation and reporting.
High-yield treasury: Earn up to 3.82% annualized yield on idle funds with money market investments from BlackRock and Morgan Stanley, managed directly within your Slash account.⁶
Working capital financing: Access short-term financing with flexible 30-, 60-, or 90-day repayment terms to help bridge cash flow gaps.⁵

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Frequently Asked Questions

How much does an EIN cost?

It’s completely free to apply for an EIN through the IRS. You can pay a third-party designee to do it, but unless there are extenuating circumstances, there isn’t really a reason to pay for your EIN.

Can I apply for an EIN if I'm not a U.S. citizen?

Yes, non-U.S. citizens can obtain an EIN for U.S. business activities. However, the responsible party must have either a Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN). If you don't have either, you'll need to apply by mail or fax and include additional documentation.