It Is Tax Season! Make Sure Your EIN Is Filed….Correctly!

One of the key responsibilities for many new businesses or businesses that are restructuring is obtaining an Employer Identification Number, or EIN, from the IRS. An EIN is a unique nine-digit number that identifies your business for tax purposes. It's similar to a Social Security number but is meant for business related items only.

An EIN also helps you register a business entity, obtain a business loan, open a business bank account and much more. An EIN is as important for your company as a Social Security number is in your personal life. For some businesses, an EIN is a tax requirement.

Do I need an EIN if I am self- employed? You don't need an EIN if you're self-employed; you can simply use your Social Security number. However, some people who are self-employed choose to apply for an EIN instead of using their Social Security number to reduce the risk of identity theft; it's less likely for someone to break into your accounts when you keep business finances and personal finances separate.

EINs must be used by business entities--corporations, partnerships, and limited liability companies. However, most sole proprietors don't need to obtain an EIN and can use their Social Security numbers instead.