How to Get an EIN for Your Business (7 Steps)

An EIN is the least interesting item on a startup checklist and one of the easiest to get wrong in a way that costs you weeks. It is a federal tax identification number for your business, it is free to obtain directly from the IRS, and a prepared applicant using the online channel can typically finish and have a number in the same session. What derails people is not the application. It is applying before the legal name is settled, naming the wrong responsible party, paying a third-party service for something that costs nothing, or treating the number as though it were a licence to operate.

This walkthrough takes the process in seven steps, in the order that avoids rework. It covers what an EIN is and what it is decidedly not, the information to gather before you start, how to choose a channel, and what to do with the confirmation once you have it. Because this is a government process, the details that change are described in general terms and flagged for you to confirm with the IRS rather than stated as fact here. If you are opening a food business, this sits inside the broader sequence our restaurant opening walkthrough lays out, and the financing conversations in our small business loan walkthrough will ask for the number once you have it.

What an EIN actually is

An Employer Identification Number is a federal tax identification number issued by the IRS to a business entity. Functionally it does for your business what a personal taxpayer identification number does for you: it identifies the entity in federal tax matters and gives banks, payroll providers, vendors, and lenders a single reference for the business rather than for you personally.

The name is slightly misleading, because having employees is only one of several reasons a business obtains one. Businesses that will never hire anyone routinely get an EIN because a bank wants it to open an account in the business name, because a supplier requires it to set up a trade account, because an equipment lender asks for it, or simply because the owner would prefer not to hand their personal taxpayer number to every counterparty they deal with.

That last reason is worth stating plainly, because it is the one most often underweighted. A sole proprietor operating without an EIN gives their personal identifying number to landlords, vendors, delivery platforms, and clients as a matter of routine. Obtaining an EIN puts a business-specific number in that role instead. It is not a security guarantee, but it removes your personal number from a lot of filing cabinets, and it costs nothing.

What an EIN is not

Getting this wrong is the most expensive misunderstanding available here, so it is worth being blunt. An EIN is not a business license. It does not give you permission to operate anything, anywhere. A number arriving in your inbox is not authorisation to open a door.

It is also not a state registration. Forming an entity, registering a trade name, and registering with a state tax authority are separate acts with separate authorities, and requirements vary considerably by state. It is not a sales tax or resale permit, which is typically issued by a state revenue department under its own process. It is not a health department approval, which for any food business is a substantial separate track with inspections attached. It is not an occupancy permit and it is not a liquor licence.

The practical consequence is that the EIN belongs on your opening checklist as one line among many, and it is one of the easier lines. Our restaurant opening walkthrough sets out the wider sequence, and our startup cost breakdown prices the licensing and permitting side that the EIN does not touch. Confirm your own state, county, and city requirements with those authorities directly, because they genuinely differ and no article can tell you what applies where you are.

The other numbers people confuse it with

New owners collect several numbers in the first months, and mixing them up creates real friction with banks and vendors. The EIN is federal and comes from the IRS. A state tax identification number, where your state issues one, is separate and comes from your state revenue department, often as part of registering for sales tax or employer withholding.

An entity’s state filing number, sometimes called a registration or charter number, is issued when the entity is formed and identifies it in state corporate records. A sales tax permit number or resale certificate number is issued for the purpose of collecting or exempting sales tax. A DUNS number or similar commercial identifier is issued by a private business information provider and is used in trade credit rather than in tax.

Keep them in one place, clearly labelled, because you will be asked for different ones by different counterparties and providing the wrong one wastes a phone call each time. Our restaurant business plan walkthrough is a sensible home for that record, since the plan is a document you already maintain and revisit.

Before you start

This is a short process for a prepared applicant and a frustrating one for an unprepared applicant, and the difference is entirely in what you have settled beforehand.

• Time: roughly an hour end to end once your information is gathered, and typically much less than that for the application itself if you use the online channel.
• Difficulty: low. The application is a series of factual questions, not a judgement exercise.
• Cost: nothing, if you apply directly with the IRS.
• What you need settled: your legal business name exactly as it is or will be registered, your entity structure, your business address and mailing address, the reason you are applying, the date the business started or will start, and the identifying information for the responsible party.
• What you do not need yet: a bank account, a lease, a licence, or any revenue. The EIN comes before most of those, and several of them will ask for it.
• What to have open: your entity formation paperwork if you have formed one, and a note of the responsible party's identifying number.

The single most common cause of rework is applying before the name and structure are final. If you are still deciding between structures, or still waiting on a name registration, finish that first. The number attaches to what you enter.

Step 1: Confirm you actually need an EIN

Start by establishing whether you need one, whether you merely want one, and either way that you do not already have one. These are three different questions and they take about ten minutes to answer.

Do you need one? Certain circumstances generally require an EIN, and having employees is the clearest of them. Operating as certain entity types, and various other specific situations, also commonly trigger the requirement. Because the list is defined by IRS rules and changes, confirm your own position with the IRS or a qualified tax professional rather than working from a summary. The cost of getting this wrong is either an unnecessary application or a missing requirement, and the second is worse.

Do you want one anyway? Many sole proprietors who are not required to have one obtain an EIN for the practical reasons described above: keeping a personal taxpayer number out of vendor files, opening a business bank account in the business name, and satisfying suppliers and equipment lenders who ask for it as routine. Our restaurant equipment financing case study covers a process where you will be asked.

Do you already have one? Owners who previously operated a business, or who started an application months ago and lost track, sometimes apply again and end up with duplicates. Check your existing records first: prior tax filings, bank account paperwork, and any accountant you have worked with. Untangling duplicate numbers is more work than checking.

Watch out: a change in your business structure sometimes requires a new EIN and sometimes only requires updating the existing one, and the distinction turns on the specifics. Do not assume either way. Confirm with the IRS before applying a second time.

Step 2: Settle your legal name and structure first

The application asks for your legal business name and your entity structure, and it records what you tell it. Applying before either is final is the most common source of avoidable rework in this whole process, because correcting an entity’s details afterwards is a separate procedure that takes longer than doing it right.

Settle the structure. Whether you operate as a sole proprietorship, a partnership, a limited liability company, or a corporation affects the application and affects a great deal else, including how the business is taxed and how liability works. That decision is genuinely a matter for a qualified attorney or accountant who knows your situation, and it is not one this walkthrough will make for you. What matters here is that it should be made before you apply, not after.

Settle the name. Enter the legal name exactly as it appears or will appear on your formation documents, character for character, including any suffix. If you will trade under a different name, that is typically a separate trade name registration with your state or county, and the application has its own place for such a name where applicable. Mismatches between the name on your EIN confirmation and the name on your formation documents cause friction at banks, which check both.

Watch out: if you are forming an entity, the usual order is to complete the formation first and then apply for the EIN, so that the name and structure you enter match the entity that actually exists. Applying first and forming later invites a mismatch. Illustratively, an owner who applies in the personal name in March and then forms a company in May has an EIN attached to the wrong thing and a bank appointment that will not go smoothly.

Step 3: Identify the responsible party

The application asks you to name a responsible party, meaning the individual who actually controls, manages, or directs the entity and the disposition of its funds and assets. The requirement is that this is a real person rather than another company, because the IRS wants an identifiable human associated with the entity.

For a single-owner business this is straightforward: it is you. For a partnership or a multi-owner company it is whichever principal genuinely holds that control, and the honest answer matters more than the convenient one. Naming whoever happens to be free to do the paperwork, rather than the person who actually controls the funds, is a misstatement rather than a shortcut.

You will need that person’s identifying information, meaning their name as it appears in official records and their taxpayer identification number. Have it to hand before you start, because the application is not a form you want to abandon halfway through and return to.

Watch out: the responsible party can change over the life of a business, and there is a process for notifying the IRS when it does. Keeping that record current is ordinary compliance, not an optional formality, and it becomes relevant precisely when an ownership change is already generating enough paperwork. Note it in your records now, so that a future partner buyout or departure includes it on the checklist. Our equipment lease walkthrough covers another area where a change in controlling ownership tends to require notification.

Step 4: Gather the information the application asks for

The application is a series of factual questions, and the reason people struggle is that they start answering them without having the answers. Assemble this first and the rest is typing.

The entity: legal name, any trade name you use, the entity structure, the state or jurisdiction where it is formed if applicable, and the date the business started or acquired. The addresses: a physical business address and a mailing address if they differ. A post office box alone is generally not acceptable as a physical address, so have a real street address ready.

The responsible party: name and taxpayer identification number, as established in step three. The purpose: the reason you are applying, which the application asks about directly, and a plain description of your principal business activity. For a food business, describe what you actually do rather than reaching for a technical category.

The employment picture: whether you expect to have employees, roughly how many, and when you expect the first wages to be paid. Estimates are acceptable, and it is better to give an honest estimate than to guess wildly in either direction. Our restaurant hiring walkthrough covers building that picture properly if you have not thought about headcount yet.

Watch out: answer from your actual documents rather than from memory. A legal name typed from recollection with a missing suffix, or a start date approximated by a month, is the sort of small inaccuracy that surfaces later at a bank counter when someone compares two pieces of paper.

Step 5: Choose your application channel

The IRS offers more than one way to apply, and they differ substantially in speed rather than in what they produce. The number is the same whichever route you take.

The online channel is generally the fastest and typically issues the number within the same session, which is why it is the default recommendation for anyone eligible to use it. There are conditions on who may use it and when it is available, and those conditions change, so confirm the current position with the IRS before you plan on it.

The other channels involve submitting a completed application and waiting for the IRS to process and return the number. They take substantially longer, sometimes considerably so during busy periods, and they exist because not every applicant is eligible for the online route, particularly some applicants without a US taxpayer identification number.

Watch out: do not plan a bank appointment, a lease signing, a payroll start, or a supplier account opening around an assumed processing time. Processing genuinely fluctuates, and no article, including this one, can tell you reliably how long a non-instant channel will take this month. Confirm current expectations with the IRS, and where timing matters, apply earlier than you think you need to.

Watch out, again: whichever channel you use, go to the IRS directly. The next section explains why in detail, but the short version is that everything a paid intermediary does here, you can do yourself at no cost.

Step 6: Complete the application in one sitting

The online application is designed to be completed in a single session, and abandoning it partway generally means starting again. With step four’s information in front of you, this is typing rather than deciding.

Work through it methodically. Enter the legal name exactly as it appears on your formation documents, including punctuation and any suffix. Enter the structure you settled in step two. Enter the responsible party from step three, with the identifying number typed carefully rather than from memory. Enter the addresses, using a real physical address. Answer the purpose and activity questions in plain terms that describe what the business does.

Before submitting, read every field back. This is the last cheap moment to catch an error. A transposed digit in an identifying number, a missing suffix in a legal name, or an address typo is trivial to fix now and a phone call later.

Watch out: if the session times out or the system is unavailable, do not immediately start a second application in the hope that one of them will work. That is exactly how duplicates happen. Wait, confirm whether the first one completed, and only then reapply. Illustratively, an owner who submits twice on a slow evening can end up with two numbers, a confused bank, and a correction process that takes longer than the original application by an order of magnitude.

Step 7: Save the confirmation and put the number to work

The application produces a confirmation, and what you do in the next five minutes determines whether you ever have to think about this again. Save it in more than one place. A digital copy in your business records, a second copy somewhere outside that system, and a printed copy in your physical files is not excessive for a document you may need to produce years from now.

Tell someone else where it is. A number known only to one person is a problem waiting for an inconvenient moment. Your accountant should have it, and at least one other trusted person in the business should know where the confirmation lives.

Then connect it to the things that need it. A business bank account in the business name is usually the first stop, and banks generally want to see the confirmation alongside your formation documents. Payroll setup needs it if you will have employees. Vendor and supplier trade accounts ask for it. Equipment financing applications ask for it, as our equipment financing walkthrough describes. Any lender you approach will want it, which our small business loan walkthrough covers in the documentation stage.

Watch out: treat the number as business-confidential rather than public. It is not a secret in the way a password is, and you will hand it to legitimate counterparties routinely, but it is an identifier that appears on fraudulent account applications, so give it out for a reason rather than by default.

Why applying directly is free

This deserves its own section because it is the single most valuable thing this walkthrough can tell you. Applying directly with the IRS costs nothing. There is no government fee for an EIN.

There is, however, a substantial market of third-party services that will submit the same application on your behalf for a fee, and their advertising is often prominent precisely because the margin is good on completing a free form. Some of these are legitimate businesses selling a convenience, often bundled with entity formation services, and none of them are providing something you cannot do yourself in an afternoon.

If you have already been quoted a price for obtaining an EIN, you now know what you are being asked to pay for. If the fee is bundled with genuine services you want, such as registered agent representation or formation filing, that is a commercial decision you can make on the merits. If it is a standalone charge for the number itself, it is a form-completion fee.

There is also a practical reason to apply yourself beyond the money. When you apply directly, the confirmation comes to you, you know exactly what was entered, and you control the record from the beginning. When an intermediary applies, you are dependent on them for the document and for the accuracy of what they typed. For a number that identifies your business for its whole life, that is worth the hour.

Where the EIN sits in your startup spend

It helps to see the zero in context. The chart below places the EIN against other illustrative opening costs for a small food business, and its whole purpose is the length of the first bar.

The reading is the first bar. Every other line on an opening budget is a real negotiation with a real range, and this one is not. That is worth remembering when a service offers to handle it for you, and it is worth remembering when you are tempted to defer the application because it feels like another expense. It is not an expense. Our restaurant startup cost breakdown prices the bars that do cost money.

Where the time actually goes

If the application itself is quick, why does the process feel longer? Because most of the effort sits before the form, in decisions that have nothing to do with the IRS. The split below is illustrative for a prepared applicant.

The lesson is the first block. Almost half the work is the entity decision, which is a conversation with an attorney or accountant rather than a form. Owners who experience this as a slow process are usually experiencing the structure decision, not the application, and the fix is to separate the two rather than to rush either.

A worked example end to end

Take one ordinary case and run it through all seven steps. Every figure is illustrative and the details are invented to show the sequence.

The situation. An owner is opening a small counter-service cafe. They have decided with their accountant to form a limited liability company, have chosen a legal name, and have not yet formed the entity. They expect two part-time employees within three months.

Step 1. They confirm with their accountant that they will need an EIN, both because employees are coming and because their bank requires one for a business account. They check that they have never held one. Ten minutes.

Step 2. They complete the entity formation first, and wait until the state confirms it, so that the legal name on the formation document is the name they will type. This is the step that takes calendar time rather than working time, and it is the reason the whole process feels longer than an hour.

Step 3. The owner is the sole member and clearly controls the funds, so they are the responsible party. They locate their taxpayer identification number rather than typing it from memory.

Step 4. They assemble the legal name from the formation certificate, the physical address of the leased unit, the mailing address which is their home, the start date, a plain description of the activity, and an honest estimate of two employees beginning in roughly three months.

Step 5 and 6. They use the online channel, complete the application in one sitting of about twenty minutes, read every field back before submitting, and receive the number in the same session.

Step 7. They save the confirmation in three places, email a copy to their accountant, and take it with the formation certificate to the bank appointment the following week. Total elapsed effort excluding the entity formation: under an hour. Total cost: nothing. The next number on their checklist, illustratively the roughly $1,200 of local permits from the chart above, is where the real spending begins, and our restaurant opening walkthrough picks up from there.

Common mistakes

• Paying a third party for a free application. Applying directly with the IRS costs nothing. If a fee is bundled with services you actually want, that is a commercial choice; as a standalone charge for the number, it is a form-completion fee.
• Applying before the entity name and structure are final. The number attaches to what you enter, and correcting an entity's details afterwards is a separate, slower procedure than getting it right the first time.
• Naming the wrong responsible party. The application asks for the individual who genuinely controls the entity and its funds, not whoever is available to do the paperwork.
• Applying more than once. A timed-out session or an impatient second attempt produces duplicate numbers, a confused bank, and a correction process far longer than the original application.
• Treating the EIN as a business license. It grants no permission to operate. State registration, local licensing, health approval, and sales tax permits are separate and vary by jurisdiction.
• Losing the confirmation. Recovering the number is possible and tedious. Saving it in three places on the day takes two minutes.

Troubleshooting and edge cases

What if I have lost my number? Look first at any tax filing made under it, your bank account opening paperwork, vendor records, and payroll documentation, and ask your accountant. If none of those produce it, the IRS has a process for assisting an authorized person, and that is the route to take rather than applying again.

What if my business name changes? A name change generally does not by itself require a new number, but it does require the IRS records to be updated, and the process differs by entity type. Confirm the current procedure with the IRS, and expect your bank to want documentation of the change as well.

What if my entity structure changes? This is the case where a new number is sometimes required and sometimes not, and the answer turns on the specific change. Do not assume in either direction. Confirm with the IRS or a qualified tax professional before either applying again or continuing with the existing number.

What if I am a sole proprietor with no employees? You may not be required to have one, and many people in that position get one anyway for the banking and privacy reasons described earlier. Confirm whether you are required with the IRS or a tax professional, then decide separately whether you want one.

What if I need a second EIN for a second business? Genuinely separate legal entities typically have their own numbers. A second location operated by the same entity generally does not need a second number. If you are unsure which situation you are in, that uncertainty is itself a sign to ask a professional, because it usually means the entity structure is not as settled as it appears.

What if the responsible party has no US taxpayer identification number? This is a real situation for foreign owners, and it affects which application channels are available. The online route may not be usable, which pushes you to a slower channel with a longer processing time. Confirm the current requirements and available routes with the IRS, and build extra time into your opening schedule.

What if my application is rejected or does not complete? Do not immediately resubmit. Establish first whether the original went through, since a duplicate is a worse problem than a delay. If it genuinely did not complete, check your entries against your documents before trying again, since a mismatch between an entered name or identifying number and official records is a common cause.

Your EIN checklist

• Confirm with the IRS or a tax professional whether you are required to have an EIN, and whether you already hold one.
• Settle your entity structure with an attorney or accountant before applying.
• Complete your entity formation and have the legal name exactly as it appears on the formation document.
• Identify the responsible party honestly, and have their identifying number to hand rather than from memory.
• Assemble the physical and mailing addresses, the start date, the business activity description, and an honest employee estimate.
• Go directly to the IRS. Do not pay a third party a standalone fee for the application.
• Confirm the current channels, eligibility conditions, and processing expectations with the IRS before planning around a date.
• Complete the application in one sitting and read every field back before submitting.
• Save the confirmation in at least three places and tell your accountant and one other person where it lives.
• Connect the number to your bank account, payroll setup, vendor accounts, and any financing application.
• Remember that state registration, local licensing, health approval, and sales tax permits are separate and still outstanding.

The bottom line

Getting an EIN is a short, free federal process that new owners routinely make harder than it needs to be. The application itself is twenty minutes of typing. What costs people time is applying before the legal name and structure are settled, naming a responsible party who does not actually control the entity, submitting twice after a timed-out session, or paying an intermediary for a form the IRS provides at no charge. Do the decisions first, gather the information, apply once, and read every field back before you submit.

Then treat the confirmation as a document you will need for the life of the business. Save it in several places, tell your accountant and one other person where it is, and connect the number to your bank account, your payroll, your vendors, and any lender you approach. Above all, remember what the number is not: it is not permission to operate, not a state registration, not a sales tax permit, and not health department approval. Those are separate tracks with separate authorities and genuinely different requirements depending on where you are. Confirm the current federal rules, channels, and timing with the IRS rather than with any article, confirm your state and local obligations with those authorities, and take entity structure and tax questions to a qualified attorney or accountant who knows your situation.

This walkthrough is general educational information about a federal administrative process and is not tax, legal, accounting, or business advice. Employer Identification Number requirements, eligibility conditions, application channels, availability, processing times, responsible party rules, and the circumstances in which a change of business structure requires a new number are set by the IRS, are described here only in general terms, and change over time, so confirm every one of them directly with the IRS or with a qualified tax professional before you act rather than relying on this article. No form numbers, fees, deadlines, phone numbers, web addresses, or processing durations are stated here for that reason. Business entity selection, ownership structure, and the tax consequences that follow from them are decisions for a licensed attorney or accountant who knows your circumstances. State entity registration, trade name registration, state tax and withholding registration, sales tax and resale permits, local business licences, occupancy approvals, health department permits, and alcohol licensing are entirely separate from a federal EIN, are issued by different authorities, and vary substantially by state, county, and city, so confirm your own obligations with those authorities directly. All dollar figures in the charts and worked example other than the zero cost of applying directly are illustrative and vary widely by jurisdiction and by business.