How Does One Know if They Need a TIN?

If you’re running a business, whether as a sole proprietor or with employees and partners, you may question if you need a TIN or tax ID number. The concept of a TIN is often confused with the SSN, as technically your Social Security Number is the same as a federal tax ID. However, it’s not the only form of federal tax ID, and as a business owner the TIN you should be worried about is the EIN.

What is an EIN?

EIN stands for employer ID number, and it’s a federal tax ID number similar to a Social Security Number. The only difference is that your EIN is assigned to you as a business, rather than you as a person. This allows the business to be recognized as a separate taxable legal entity. However, depending on the type of business you operate you may not need an EIN.

So Do You Need a TIN/EIN?

Depending on the type of business you operate, you may not need a TIN. Sole proprietorships and LLCs often don’t require a federal tax ID number as long as they don’t have employees and don’t file specific types of taxes, such as excise tax or alcohol tax. Corporations such as C-corps and S-corps, however, are legally recognized separate entities that require a TIN.

Trusts, non-profits, and several other types of legal entities also need a TIN to operate and legally file taxes according to regulation. Publicly traded companies and certain other legal entities can also be found with a tax ID number lookup.

Easy Online TIN Application

With IRS EIN Tax ID Filing Service, you can apply for a TIN online and check your TIN number status during the application process. If you have any questions, speak to the professionals at IRS EIN Tax ID Filing Service to get started on your EIN application.