A federal Employer Identification Number is free from the IRS, and so is an Individual Taxpayer Identification Number. Most state tax IDs are free too, though a handful of states charge modest registration fees that generally top out around $100. So when someone asks how much a tax ID costs, the honest answer is usually nothing — the only real charges come from optional third-party preparers, private acceptance agents who verify ITIN documents, or a small number of state registration fees.
Federal EIN: No Fee, Ever
The IRS does not charge for an Employer Identification Number. Every business structure gets the same free access, whether you run a sole proprietorship, partnership, LLC, corporation, or nonprofit.1Internal Revenue Service. Get an Employer Identification Number Apply online and you receive your nine-digit number immediately, with no charge at any step.
An EIN functions like a Social Security number for your business. You need one to hire employees, file business tax returns, open a commercial bank account, and apply for business licenses.2U.S. Small Business Administration. Get Federal and State Tax ID Numbers
Sole proprietors and independent contractors aren’t always required to have an EIN, but many get one anyway. Without one, you have to put your Social Security number on W-9 forms, 1099s, and credit applications, which exposes your most sensitive identifier to every client and vendor. A free EIN keeps that number private. If you don’t provide either a valid EIN or Social Security number to a client, the client is generally required to withhold 24% of your payments as backup withholding.3Internal Revenue Service. Publication 15 – Employers Tax Guide
Watch for Paid Look-Alike Sites
The IRS specifically warns that “you never have to pay a fee for an EIN.”1Internal Revenue Service. Get an Employer Identification Number Some third-party websites are designed to look like official government portals and charge for something the government provides for free. To confirm you’re on a legitimate government site, check that the URL ends in .gov and uses a secure HTTPS connection with a lock icon in the address bar.4Internal Revenue Service. How to Know Its the IRS Any site charging you a fee for an EIN is not the IRS.
What You’d Pay a Third Party for EIN Help
Some business owners hire a filing service or law firm to prepare and submit the EIN application. These services typically charge between $50 and $300, depending on the level of consultation involved. The fee covers the preparer’s time; none of it goes to the government. For a straightforward structure, most owners can complete the application themselves in a few minutes.
ITIN: Free From the IRS, But Document Verification May Cost
If you’re not eligible for a Social Security number but need to file a U.S. federal tax return, you’ll need an Individual Taxpayer Identification Number. The IRS does not charge to process Form W-7. What you may pay for is the identity-document verification, and how much depends on which route you choose.
- An IRS Taxpayer Assistance Center will review your Form W-7, authenticate most supporting documents in person, and return your originals at the appointment. No charge.
- VITA sites that offer ITIN services can help you complete Form W-7, authenticate documents, and mail your application at no cost, though locations are limited.
- A Certifying Acceptance Agent is an IRS-authorized private individual or firm who verifies your documents so you don’t have to mail originals. CAAs set their own fees, which commonly run from about $50 to $275 or more depending on the firm and the complexity of the case.
- You can also mail Form W-7 directly to the IRS with your tax return and original documents (or certified copies). This is free, but your originals sit with the IRS while it processes the application.
The IRS maintains a searchable list of approved acceptance agents in every U.S. state and in dozens of countries.5Internal Revenue Service. ITIN Acceptance Agents If cost is the concern, look at an IRS Taxpayer Assistance Center or a VITA site first.6Internal Revenue Service. How to Apply for an ITIN
Renewing an ITIN
An ITIN expires automatically if you don’t use it on a federal tax return for three consecutive tax years, with expiration taking effect on December 31 after that third year of non-use.7Internal Revenue Service. How to Renew an ITIN Renewal uses the same Form W-7 and follows the same process. The IRS charges no fee to renew. If you use a Certifying Acceptance Agent again for document verification, expect to pay that agent’s service fee a second time.
State Tax IDs
Most states issue their tax identification numbers — used for income tax withholding, sales tax collection, or unemployment insurance — at no charge. A small number of states charge registration fees that can run up to roughly $100, depending on the type of tax account and the filing method. Some states charge more for mail-in applications than online ones, and a few require refundable security deposits for sales tax permits rather than flat fees.
Five states have no state-level sales tax at all: Alaska, Delaware, Montana, New Hampshire, and Oregon. A sales tax permit doesn’t apply there. If your state does collect sales tax, check with its department of revenue for the exact cost and process. Most states handle registration through an online portal similar to the federal system.
When a Change to Your Business Means Getting a New EIN
Your EIN stays with your business permanently, but certain structural or ownership changes require a new one. A name change or address change does not.8Internal Revenue Service. When to Get a New EIN The common triggers:
- A sole proprietor incorporates, forms a partnership, or declares bankruptcy.
- A corporation receives a new charter from the secretary of state, converts to a partnership or sole proprietorship, or merges to create a new corporation. The surviving corporation after a merger keeps its existing EIN.
- A partnership incorporates, dissolves and starts a new partnership, or a partner takes over as a sole proprietor.
- An LLC terminates and forms a new corporation or partnership, or a single-member LLC begins filing employment or excise taxes.
Each new EIN is free, so the only cost is your time. The IRS limits online applicants to one new EIN per responsible party per day.1Internal Revenue Service. Get an Employer Identification Number
What It Costs to Get It Wrong
Because the IDs themselves are free, the real financial exposure comes from not having a valid one, or from filing with an incorrect one.
If you fail to provide a correct taxpayer identification number to a client or financial institution, they’re generally required to withhold 24% of your payments and send it to the IRS as backup withholding.3Internal Revenue Service. Publication 15 – Employers Tax Guide You can claim that money back when you file, but it ties up your cash flow until then.
Businesses that file information returns like 1099s with a missing or incorrect TIN face per-return penalties that grow the longer the error stands. For returns due in 2026:9Internal Revenue Service. Information Return Penalties
- Up to 30 days late: $60 per return
- 31 days late through August 1: $130 per return
- After August 1 or not filed at all: $340 per return
- Intentional disregard: $680 per return, with no maximum cap
Interest accrues on unpaid penalties until the balance is cleared. Small businesses face lower maximum penalty caps than larger companies, and the IRS may reduce or remove penalties if you can show reasonable cause.
Filing a tax return with an expired ITIN can delay your refund and disqualify you from tax credits you would otherwise be entitled to claim.7Internal Revenue Service. How to Renew an ITIN If yours has gone unused for three consecutive tax years, renew it before you file.