What Is an EIN? Who Needs One and How To Get It

What Is an Employee Identification Number (EIN)?

By Motley Fool Staff – Updated Dec 13, 2024 at 11:31 AM

Key Points

An EIN is a unique nine-digit identifier assigned by the IRS, essential for business taxes.
Businesses needing an EIN include those with employees, LLCs, or those in bankruptcy.
Applying for an EIN online offers immediate receipt, while other methods take about four weeks.

An employer identification number (EIN) is usually a nine-digit number assigned to new and restructuring businesses by the IRS. It's somewhat akin to a Social Security number (which also has nine digits). Read on to find out more about EINs, who needs one, how to get one, and the benefits of having an EIN.

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Person's hand typing on a calculator while holding a gold pen. — Image source: Getty Images.

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EINs: The bottom line

Not everyone will need an EIN. There were 28.4 million non-farm sole proprietorships in the United States in 2020, many with no employees. Still, there's much to be said for getting an employer identification number if you're running a business. It shows you're serious about your company, you're complying with tax laws, and that you might even have your eye on becoming a bigger business if that's your goal.

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