Definition:
A Tax ID or Employer ID Number (EIN) is a number assigned to a business by the IRS to identify the business for purposes of taxation. A business must include its Tax ID on bank account applications, income tax forms, and employment tax reports and payments. A Tax ID for a business serves the same purposes as a Social Security number for an individual.
The term "Employer ID Number" is something of a misnomer, because even businesses without employees may need an EIN. The term "Tax ID" is more generally used.
A business uses IRS Form SS-4 to apply for a Tax ID number. This form can be completed online or by phone or mail.
Also Known As: Federal Tax ID Number, Tax ID Number
Common Misspellings: Employee ID Number
Examples:
When he incorporated his business, Sam applied for an Employer ID Number online. He was surprised to find that he received his number immediately after he completed the form.
