An Employer Identification Number (EIN) is a nine-digit number assigned by the Internal Revenue Service (IRS) to businesses operating in the United States. It is used to identify the business for tax purposes and is required for opening a business bank account, hiring employees, and filing taxes. For example, a business called “ABC Inc.” may have an EIN of 12-3456789.
EINs are essential for businesses as they allow them to fulfill their tax obligations, establish a separate identity from the owner, and access certain financial services. Historically, businesses were required to obtain an EIN only if they had employees. However, since 2011, all businesses, regardless of size or employee count, are required to have an EIN.
