No, an EIN is not the same as a Social Security Number. Both are nine-digit tax identification numbers, but a Social Security Number identifies you as an individual for personal tax and benefit purposes, while an Employer Identification Number identifies a business, trust, estate, nonprofit, or other entity for federal tax purposes.1Internal Revenue Service. Taxpayer Identification Numbers They come from different agencies, follow different formats, and belong on different kinds of paperwork.
How the Two Numbers Differ
Start with the formatting, which is the quickest way to tell them apart. An SSN is written XXX-XX-XXXX. An EIN is written XX-XXXXXXX.
The Social Security Administration issues SSNs. The IRS issues EINs.1Internal Revenue Service. Taxpayer Identification Numbers Your SSN tracks your earnings during your working life and your benefits once you start collecting Social Security, and it’s your primary identifier for filing personal income taxes.2Social Security Administration. Understanding the Benefits You also use it when you start a job, open a bank account, or apply for credit.
An EIN, sometimes called a Federal Tax Identification Number, does the parallel work for an entity. It goes on business tax returns, payroll filings, and business bank account applications.3Internal Revenue Service. Employer Identification Number Once the IRS assigns an EIN, it belongs to that entity permanently and cannot be transferred to another business or reused by a different owner.4Internal Revenue Service. If You No Longer Need Your EIN
The IRS is explicit that you should not use an EIN in place of your SSN for personal purposes.5Internal Revenue Service. Understanding Your EIN They identify different taxpayers, and swapping one for the other can trigger processing delays or IRS notices.
If You’re a Sole Proprietor, Which Do You Use?
This is where the line between the two numbers blurs for most readers. If you operate as a sole proprietor and have no employees, the IRS does not require you to get an EIN. You can file your business taxes using your personal SSN, and many freelancers and independent contractors do exactly that for years.
Getting an EIN anyway has a real benefit: privacy. Without one, you’ll be writing your SSN on W-9 forms for every client and vendor who pays you. An EIN lets you keep your SSN off those forms, which reduces your exposure to identity theft. Applying is free and takes minutes.
Once a sole proprietor hires employees, an EIN becomes mandatory.3Internal Revenue Service. Employer Identification Number
When an EIN Is Required
Beyond a sole proprietor with employees, the IRS requires an EIN for a range of entities and tax situations:3Internal Revenue Service. Employer Identification Number
- Corporations, partnerships, and LLCs.
- Any entity that files employment, excise, or alcohol, tobacco, and firearms tax returns.
- Anyone withholding taxes on non-wage income paid to a non-resident alien.
- Trusts, estates, and nonprofits that need to report income and file returns.
- Keogh plans and other qualified retirement plans.
- Real estate mortgage investment conduits and farmers’ cooperatives.
A Note on ITINs
There’s a third number worth flagging so you don’t confuse it with the first two. An Individual Taxpayer Identification Number is issued by the IRS to people who need to file U.S. tax returns but aren’t eligible for an SSN, such as certain nonresident and resident aliens and their dependents. An ITIN is formatted like an SSN but always starts with the digit 9.1Internal Revenue Service. Taxpayer Identification Numbers It’s strictly a tax processing number: it doesn’t authorize work in the United States and doesn’t make the holder eligible for Social Security benefits.
How to Get an EIN
If you’ve concluded you need an EIN, apply directly through the IRS. The number is free. Some third-party websites charge up to $300 for help with the same form you can file yourself in minutes.6Federal Trade Commission. FTC Warns Operators of Websites That Charge for an Employer Identification Number Claim Affiliation With IRS
The fastest route is the online application at irs.gov. If you have a U.S. address and a valid SSN or ITIN, you can complete the application and get your EIN immediately.7Internal Revenue Service. Instructions for Form SS-4 You can also submit Form SS-4 by fax, which usually produces a response within four business days, or by mail, which takes roughly four to five weeks.3Internal Revenue Service. Employer Identification Number International applicants without a U.S. address cannot use the online tool and must apply by phone at 267-941-1000, by fax, or by mail; on Form SS-4, applicants without an SSN can enter an ITIN or a foreign tax identification number.