An Employer Account Number for unemployment, usually called an EAN, is the identifier your state’s unemployment insurance agency assigns to your business so it can track your tax payments, your quarterly wage reports, and any benefit claims filed by your former employees. Every employer who crosses the state’s liability threshold gets one, and it stays with the business for as long as it operates in that state.
How to Get an EAN
You register with your state unemployment insurance agency, and the clock usually starts the moment you hire your first employee. Most states give you between 10 and 30 days after becoming a liable employer to complete registration. Some states trigger liability not on the hire itself but on a dollar threshold of wages paid in a quarter, typically somewhere between $7,000 and $13,000.
The paperwork is straightforward. You submit your business name, address, entity type, and your Federal Employer Identification Number. Most states take the application online and issue the EAN within a few business days. Some then mail a separate authorization code or confirmation letter to your business address.
What the EAN Is Used For
Once assigned, the EAN is the identifier for essentially everything you do with the state unemployment system.
- Quarterly wage reports. Each quarter you report every employee’s wages under your EAN. The state uses that data to decide whether former employees qualify for benefits and how much they can receive.
- Tax payments. Unemployment tax contributions are due quarterly on the same schedule as the wage reports and fund the state’s unemployment trust fund.
- Benefit claim responses. When a former employee files for unemployment, the state notifies you through your EAN. You can respond with information about the separation, and any benefits paid are charged to your account.
That last piece matters more than new employers often realize, because the benefits charged against your EAN directly feed your future tax rate.
How the EAN Affects Your Tax Rate
State unemployment taxes are experience-rated. The more claims your former employees successfully file, the higher your rate climbs over time, and your EAN is the account where that history accumulates.
New employers start at a default rate set by the state. These vary widely, from as low as 0.01% to over 10% for construction employers in high-rate states. Once you have enough history, the state recalculates based on your actual experience. Low turnover and few successful claims earn a lower rate. Frequent layoffs and heavy benefit payouts push the rate up.
Mechanically, the state keeps a running balance on your account reflecting the difference between taxes you’ve paid in and benefits charged out. A positive balance pulls your rate down. A negative balance pushes it up, sometimes to the maximum for several years running. That is why some employers actively contest claims they view as unjustified: every successful claim chips away at the balance.
Finding a Lost EAN
If you’ve misplaced yours, there are several practical ways to recover it. Check prior correspondence from the state unemployment agency. Pull a previously filed quarterly wage report. Ask your payroll provider, since they need the number to file on your behalf. Many states also require employers to display an unemployment insurance poster in the workplace, and the EAN often appears on it.
If none of that works, contact your state’s employer services unit. You’ll typically need to verify your identity with the business name, address, FEIN, and the owner’s name along with the last four digits of their Social Security number.
Multi-State Employers and Remote Workers
Your EAN is state-specific. If you have employees in more than one state, you need a separate EAN in each state where those employees work, even if your business only has a physical office in one state.
The question of which state collects the unemployment taxes follows the “localization of work” tests used across all states. An employee’s work is localized where they physically perform it, as long as any work outside that state is incidental, meaning temporary or isolated. A full-time remote employee living in a different state than your office? Their unemployment taxes go to the state where they actually sit and work, and you need an EAN there. The practical rule: every time you hire in a new state, check whether you need to register for unemployment insurance in that state.
Buying or Selling a Business
When a business changes hands, the unemployment account often moves with it. If you acquire all or part of an existing business, you generally inherit some or all of the prior owner’s experience rating. That cuts both ways: a positive account balance and low rate transfer along with a negative balance and a high rate.
A transfer typically occurs when you take over another employer’s operations, assume their obligations, acquire their goodwill, or continue to employ substantially the same workforce. Acquire the whole business and the seller’s account closes into yours. Acquire part and the state calculates the percentage of experience to transfer based on the portion of workforce and payroll you absorbed.
Due diligence on the seller’s unemployment account matters before you close. A deeply negative balance can raise your tax rate for years after the purchase.
SUTA Dumping Is Prohibited
Some employers have tried to game this by creating shell companies, transferring the workforce to the new entity, and claiming the lower new-employer rate instead of their actual experience rate. Others have bought small businesses with clean records to pick up favorable rates. The practice is called SUTA dumping, and federal law requires every state to prohibit it as a condition of receiving federal unemployment program funding. States must impose penalties on employers who knowingly attempt these schemes.1U.S. Department of Labor. UIPL 30-04 SUTA Dumping – Amendments to Federal Law
EAN vs. Federal Employer Identification Number
The EAN and the FEIN belong to different systems. Your FEIN is a nine-digit number issued by the IRS that identifies your business for federal tax purposes and stays the same no matter where you operate. Your EAN comes from a state unemployment agency and applies only within that state’s unemployment program.
Two things trip employers up. Some states use “state EIN” to mean the same thing as EAN. And some states happen to assign an EAN that matches your FEIN. Don’t treat them as interchangeable. The FEIN goes on your federal returns. The EAN goes on your state quarterly wage reports and unemployment tax filings. If you operate in three states, you’ll have one FEIN and three EANs.
How Your EAN Connects to Federal Unemployment Tax
Your EAN also ties into the federal unemployment tax system. The Federal Unemployment Tax Act (FUTA) imposes a 6.0% tax on the first $7,000 of each employee’s wages per year.2Office of the Law Revision Counsel. 26 USC 3301 – Rate of Tax Most employers don’t pay the full 6.0%, because paying your state unemployment taxes on time earns a credit of up to 5.4% against your FUTA liability.3Office of the Law Revision Counsel. 26 USC 3302 – Credits Against Tax That brings the effective FUTA rate down to 0.6% for most employers, or $42 per employee per year.
The catch is that your state must be in good standing with the federal government. When a state borrows from the federal unemployment trust fund and doesn’t repay within two years, it becomes a “credit reduction state,” and your FUTA credit shrinks. For 2025, California faced a 1.2% credit reduction, meaning employers there paid an effective FUTA rate of 1.8% instead of 0.6%.4Federal Register. Notice of the Federal Unemployment Tax Act (FUTA) Credit Reductions Applicable for 2025 You report all of this on IRS Form 940, your annual FUTA return, where you claim the credit for state contributions paid through your EAN.5Internal Revenue Service. FUTA Credit Reduction
Keeping state unemployment taxes current under your EAN isn’t just a state compliance matter. Late state payments can cost you the FUTA credit on the federal side, and that credit is worth far more than most small employers realize.
Penalties for Non-Compliance
Failing to register for an EAN, filing wage reports late, or paying unemployment taxes past the deadline all carry consequences. Late contributions typically trigger interest charges and can push up your experience-rated tax rate in future years. Late wage reports often draw flat penalties that grow the longer you wait, plus per-employee charges in some states.
The bigger risk is employee misclassification. If you treat workers as independent contractors to avoid unemployment tax obligations and an audit determines they were actually employees, you can face back taxes covering multiple years of unpaid state contributions, unpaid FUTA, and penalties for failing to file correct payroll information. Some states impose separate penalties for each misclassified worker.
If You’re a Job Seeker, Not an Employer
If you’re filing for unemployment benefits rather than running a business, the EAN works behind the scenes. You don’t need your former employer’s EAN to file a claim. When you provide the employer’s name and address on your application, the state agency matches it to the correct employer account on its own. The EAN ensures that benefit charges land on the right employer’s record, which affects their tax rate but not your benefits.