Published By Janet Gershen-Siegel at June 28th, 2022
If you’re a business owner, you most likely realize you need an EIN. But how do you use the IRS website for EIN number?
The Internal Revenue Service wants to be able to collect business taxes from your business. This nine digit number makes it possible for the IRS to match an official return to a business. To be able to prepare tax returns, you’ll need an official EIN. And tax returns can be a requirement for getting financing. Fortunately, you can apply for this vital number online.
Before you start your EIN application, the United States government strongly suggests that you check your eligibility. Entities which must fill out EIN applications include:
According to the IRS, You need an EIN for several reasons. The ones which directly relate to business credit building are:
The ones which do not directly relate to business credit building are:
The IRS will only issue one EIN to one person per business per day.
The IRS states,
“For entities with shares or interests traded on a public exchange, or which are registered with the Securities and Exchange Commission, “responsible party” is (a) the principal officer, if the business is a corporation; (b) a general partner, if a partnership; or (c) a grantor, owner, or trustor, if a trust. Except for government entities, the responsible party must be an individual (i.e., a natural person), not an entity.”
“For all other entities, “responsible party” is the individual … who ultimately owns or controls the entity or who exercises ultimate effective control over the entity. The individual identified as the responsible party should have a level of control over, or entitlement to, the funds or assets in the entity that, as a practical matter, enables the individual, directly or indirectly, to control, manage, or direct the entity and the disposition of its funds and assets.”
There are some differences if the applicant is a government entity.
Now that this is done, it’s time to walk through the process.
Start at the IRS official website and navigate to Apply for an Employer Identification Number (EIN) Online.
I highly recommend reading this page in its entirety. In particular, you will need to complete the entire form in one session. Therefore, be sure you have every single bit of information you will need. And, before you apply for an EIN, make sure you have incorporated your business. This may mean speaking with a lawyer well-versed in tax and/or business law.
Click Begin Application
On this page, you’ll select your business entity. Even if you are a sole proprietor, the only real type of entity you can use to build business credit is a corporation of some sort.
Select Corporations and click Continue.
The IRS recognizes a few different types of corporations. But unless the applicant is the true principal officer/general partner for a personal service corporation (like a law firm), then they will be selecting one of the first two.
For a smaller corporation, usually an S corporation is best. But check with a lawyer or an accountant to be sure. In this example, I chose an S corporation.
The IRS wants you to be sure you know what you’re getting yourself into. If you’re unsure, click Change Type and go to the previous page and change your answer. And if you are sure, click Continue.
In the next page, you’re asked why you even want an official EIN in the first place. Most companies building business credit will choose one of the four starred reasons.
Next, the IRS wants to know how to contact you or whoever will be responsible for the business. Provide name, etc. which must match the IRS’s records perfectly. If the record doesn’t match, the IRS may offer a means of correcting this data from a pop-up information menu. Always choose whatever the IRS says you should change this data to.
One of the principles of Fundability™ is that your business must have a physical address which can accept deliveries. The IRS wants you to have one, too. Add details and accept any corrections the IRS may offer.
On the next page, add details like the name of the business. The IRS will pull the state directly from the address you added on the previous page.
On the next page, add some more specific corporate details.
Check the long list of possible industry types and see where your company best fits. For the purposes of this demonstration, I chose “Other”.
If you chose any industry but “other”, you most likely won’t see this page. But if you did choose “other”, you’ll need to elaborate. For the purposes of this demonstration, I chose “Consulting”.
If you didn’t choose “Consulting”, then it’s likely you won’t see this page. But if you did select “Consulting”, add a bit more information.
I highly recommend going with the electronic option, as it is considerably faster.
Finally, the official website of the Internal Revenue Service will show you your selections one last time, so you can be absolutely certain that you got everything correct.
Click Continue, and then you’ll get your valid taxpayer identification number.
So, one of the aspects of Fundability is a company’s ability to provide its tax returns. For many types of business financing, they are an absolute must. Follow the above steps and get your Employer Identification Number right the first time, every time. And be sure to contact us for your free business credit consultation, to get even more help for your business.