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An Employer Identification Number (EIN) is a unique nine-digit number issued by the United States Internal Revenue Service (IRS) to identify a business for taxation purposes. It is also known as a Federal Employer Identification Number (FEIN) or Federal Tax Identification Number. Similar to how a Social Security Number identifies an individual in the United States, an EIN is used to identify a business in tax returns, payroll records, business banking activities and official communications with the IRS.
This guide explains what an EIN is, who requires one, how to apply for it through the IRS, how it differs from a Taxpayer Identification Number (TIN), and the equivalent identifiers used in India such as PAN, GSTIN, and TAN, which perform similar business identification and tax-compliance functions under Indian regulations.In summary
An Employer Identification Number is a free, 9-digit tax identification number issued by the IRS to identify businesses for federal tax purposes. Most eligible applicants receive it immediately when applying online, making it quick and convenient to obtain.
- An EIN is a free 9-digit number issued by the IRS in the format XX-XXXXXXX to identify a business for tax reporting and compliance.
- FEIN (Federal Employer Identification Number) and Federal Tax Identification Number are alternative names for the same EIN.
- You can apply online for immediate issuance, by fax in approximately four business days, or by mail in around four weeks.
- Once issued, an EIN is permanent. It is not reused or cancelled, even if the business closes.
- The closest Indian equivalents are PAN for income tax, GSTIN for GST compliance, and TAN for TDS/TCS-related transactions.
If you are exploring business financing after completing the process of how to get an EIN, check your eligibility for a Bajaj Finance Business Loan to access funds for your business growth.
What is an Employer Identification Number (EIN)?
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An Employer Identification Number is a unique 9-digit tax identification number, formatted as XX-XXXXXXX, issued by the Internal Revenue Service (IRS) to identify businesses for federal tax purposes. The EIN meaning is similar to a business tax ID. It is also known as a FEIN (Federal Employer Identification Number) or Federal Tax Identification Number.
An EIN is issued free of cost and remains permanently assigned to the business, even if it stops operating. It is used for tax filing, opening business bank accounts, hiring employees, and other official business activities.
Feature Detail Indian equivalent Format XX-XXXXXXX (9 digits) PAN uses a 10-character alphanumeric format Issued by Internal Revenue Service (IRS) Income Tax Department Also known as FEIN, Federal Tax Identification Number PAN (closest equivalent) Cost to apply Free PAN application fee applies Permanence Never reused or cancelled PAN remains permanent Purpose Business tax identification PAN (primary), GSTIN and TAN (supplementary) What is a State Employer Identification Number?
Even if your business already has an EIN from the central government, you might also need to get a separate one from the state. Many businesses are required to have a State Employer Identification Number (State EIN) for each state where they pay taxes. In some cases, it can also help protect against identity theft, especially for sole proprietors.
Since tax rules can differ from one state to another, business owners should check the local rules to see if they need a State EIN and how to apply for it.
Employer Identification Number example
An EIN is formatted as XX-XXXXXXX. For instance, an example of an EIN might be 12-3456789. This number helps the IRS track the business's tax obligations and filings. It's unique to each business and once issued, it is never reissued or reused by the IRS, ensuring that each business's financial and tax history is distinctly maintained under this unique identifier.
Why is an EIN important for businesses and other entities?
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An Employer Identification Number is important because it is required for federal tax filing, hiring employees, and opening business bank accounts in the US. Understanding the EIN meaning helps businesses recognise its role in tax compliance, financial operations, and business identity.
Use case Why it matters Tax filing Required on federal business tax returns filed with the IRS Hiring employees Needed to report payroll and withhold employment taxes Opening business accounts Most US banks require an EIN to open a business bank account Building business credit Helps establish a business credit profile separate from the owner's personal credit history Protecting personal SSN Sole proprietors can use an EIN instead of their Social Security Number on business documents Licences and permits Many US business licence and permit applications require an EIN If you are expanding your Indian business into the US, learn how to get an EIN and explore a Bajaj Finance Business Loan to support your business growth, subject to eligibility.
Who is required to obtain an EIN from the IRS?
An Employer Identification Number is required by most US business entities for tax reporting, hiring employees, and other official business activities. While Indian business structures such as Limited Liability Partnerships (LLPs) and other entities may have different registration requirements, an EIN applies specifically to eligible US entities carrying out qualifying business activities.
- LLCs (Limited Liability Companies)
- Corporations and S Corporations
- Partnerships
- Sole proprietors with employees
- Non-profit organisations
- Trusts and estates
- Government agencies
- Churches and church-controlled organisations
- Keogh plan holders
- Other eligible entities conducting qualifying business activities in the US, as specified by the IRS
How to get an Employer Identification Number
An Employer Identification Number is free to apply for, and eligible applicants can obtain one through four methods: online, fax, mail, or phone, depending on their location and eligibility.
- Apply through the IRS website using the EIN application online free service if your principal business is located in the US. Eligible applicants typically receive their EIN immediately after successful validation.
- Complete Form SS-4 and submit it by fax. If you include a return fax number, the IRS generally issues the EIN within approximately four business days.
- Mail the completed Form SS-4 to the IRS if your application is not time-sensitive. Processing usually takes around four weeks.
- International applicants, including Indian businesses requiring a US Employer Identification Number, can apply by calling the IRS international EIN helpline.
| Method | Processing time | Best for |
|---|---|---|
| Online (IRS website) | Immediate | US-based businesses |
| Fax (Form SS-4) | Approximately 4 business days | Businesses needing written confirmation |
| Mail (Form SS-4) | Approximately 4 weeks | Non-urgent applications |
| Phone (International) | During the same call, subject to eligibility | Indian and other foreign businesses applying for a US EIN |
If you are an Indian business applying for a US EIN, the phone or fax method is generally the most suitable option if you are not eligible to apply online.
For Indian businesses requiring a US EIN
An Indian business can obtain a US EIN even without a physical presence in the United States. This may be necessary for activities such as selling on US-based marketplaces, opening US payment accounts, or establishing a US business entity. In such cases, the business can apply by submitting Form SS-4 via fax or post, or by contacting the IRS international EIN helpline. The application must identify a responsible party; however, foreign applicants are not required to have a US Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) when applying through these methods.
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Benefits of an Employer Identification Number
An Employer Identification Number allows you to legally operate a US business by meeting federal tax requirements and supporting essential business operations. An EIN also helps establish your business as a separate legal and financial entity.
- Use an EIN to hire employees legally and report payroll and employment taxes to the IRS.
- Open US business bank accounts, apply for business credit, and build a separate business credit profile.
- File federal business tax returns and register for applicable state taxes using your EIN.
- Use your EIN instead of your Social Security Number on business documents, helping protect your personal identity and reduce the risk of identity theft.
If you operate or plan to expand into the US market, understanding the benefits of an EIN is essential. The next section explains the Indian tax identification numbers that serve similar purposes for businesses.
Where do I find my EIN if it is lost?
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If you lose your EIN, you can usually recover it by checking your IRS records, previous tax filings, or business banking documents. You do not need to apply for a new Employer Identification Number.
- Check your original IRS EIN Assignment Notice (CP 575).
- Look for your EIN on previously filed federal business tax returns.
- Contact the bank where you opened your US business bank account, as it may have your EIN on file.
- Call the IRS Business and Specialty Tax Line at 1-800-829-4933 to retrieve your EIN after identity verification.
If you are unable to locate your EIN using these methods, contact the IRS directly for assistance with recovering your existing number.
Closing your Employee Identification Number
Closing an EIN involves notifying the IRS to deactivate the business account linked to the EIN. This is typically done after the business has filed its final tax return and paid all owed taxes. The IRS requires a formal letter stating the reason for the closure, such as dissolution or the business ceasing operations, to finalise the process and prevent future tax liabilities.
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Indian equivalent of an EIN: PAN, GSTIN, and TAN
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India does not use Employer Identification Numbers (EINs). Instead, businesses operating in India are identified through different registration and tax identification numbers issued under Indian tax regulations. If you are an Indian business looking for the equivalent of a business tax identification number, the following identifiers are the most relevant:
Identifier Issued by Purpose Format PAN (Permanent Account Number) Income Tax Department The primary tax identifier for a business. It is required for income tax filings, opening bank accounts and carrying out most financial transactions. 10-character alphanumeric code (e.g., ABCDE1234F) GSTIN (Goods and Services Tax Identification Number) GST authorities Identifies a business registered under GST. It is required for collecting GST, issuing GST-compliant invoices and filing GST returns. 15-character alphanumeric code, linked to the state of registration TAN (Tax Deduction and Collection Account Number) Income Tax Department Required for businesses responsible for deducting or collecting tax at source (TDS/TCS). 10-character alphanumeric code (e.g., ABCD12345E) For most Indian businesses, PAN serves as the closest equivalent to a US EIN, while GSTIN and TAN are used for specific tax compliance requirements under Indian law.
How to get an EIN: Processing time
An Employer Identification Number is issued immediately for eligible online applications, while other application methods can take up to four weeks. If you are wondering how to get an EIN, the processing time depends on the method you choose.
Application method Processing time Available to Notes Online (IRS EIN Assistant) Immediate US businesses and US territories EIN application online free; must be completed in one session Fax (Form SS-4) Approximately 4 business days US and international applicants Include a return fax number for faster processing Mail (Form SS-4) Approximately 4 weeks US and international applicants Slowest application method Phone (IRS International Helpline) During the same call International applicants, including Indian businesses Foreign applicants can apply without an SSN or ITIN, subject to IRS requirements Choose the application method that best suits your location and urgency to receive your EIN as quickly as possible.
Conclusion
An Employer Identification Number (EIN) is indispensable for businesses in the U.S., serving not only as a means to comply with IRS regulations but also as a tool for enhancing business credibility and operational capabilities. It facilitates a range of business activities, from opening bank accounts to applying for business loans and understanding the applicable business loan interest rate. Proper management and understanding of the EIN’s role and requirements can significantly contribute to the smooth functioning and growth of a business. Thus, securing an EIN is a critical step for any business starting its operations or expanding its reach in the marketplace.
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Frequently Asked Questions
Overview
What is the EIN number in India?
In India, the equivalent of an Employer Identification Number (EIN) is known as the Tax Deduction and Collection Account Number (TAN). This unique identifier is used primarily for businesses managing the deduction and collection of taxes. It is mandatory for entities required to withhold taxes on payments made to third parties, such as employees.
How long will it take to get an EIN?
Obtaining a TAN in India typically takes about 5 to 10 working days from the date of application. This duration can vary depending on the processing speed of the Tax Department and the accuracy of the information provided in the application.
How do i find my Employer Identification Number?
To find a TAN or EIN, businesses can check official correspondence from the tax authorities, or look it up online through government portals like the Income Tax Department’s official website. In the U.S., businesses can use the SEC’s EDGAR system for public companies or contact the IRS for assistance.
What happens if you lose or misplace your EIN?
If you lose or misplace your TAN or EIN, it’s important to contact the issuing authority immediately to secure your tax records and prevent misuse. In India, you would contact the Income Tax Department, while in the U.S., you would contact the IRS to report the issue and seek guidance on securing your EIN.
Does a sole proprietor need an Employer Identification Number too?
No. In India, a sole proprietor does not require an Employer Identification Number (EIN), as India does not issue EINs. The primary tax identifier for a sole proprietorship is the PAN. If the business is registered under GST, the GSTIN is also used for tax compliance and business transaction
How does an EIN support payroll tax compliance?
An Employer Identification Number is required to support payroll tax compliance by enabling employers to report wages, withhold employment taxes, and file payroll tax returns with the IRS. Businesses use their EIN when submitting Form 941 (Employer's Quarterly Federal Tax Return), reporting federal income tax withholding, and paying Social Security and Medicare taxes. Without an EIN, employers cannot meet many of their federal payroll tax reporting obligations.
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