When a person dies, any income-generating assets they leave behind become an estate. Typically, those assets will become the responsibility of the deceased’s descendants, or an executor, at which time an EIN for an estate will be required.
An Employer Identification Number, or EIN for short, is a federal tax ID used by the Internal Revenue Service (IRS) to track the tax responsibilities of various legal entities. The decedent’s Social Security Number (SSN) may not be used to report income generated by his or her assets; when a person dies, the estate becomes a separate legal entity and therefore will need a new tax ID.
You can apply for an EIN several ways, but the fastest and easiest way to get an EIN for an estate is to apply online.
Our online application process is easier and faster than other application processes. We’ve streamlined the form and expedited the filing process so that you can get results within 1-2 business days, instead of 1-2 weeks.
Our online portal also allows you to check your EIN status online anytime you want, and we’ll keep a copy for your records in case you ever lose or misplace this important tax ID number.
To complete the form, you will need a few important pieces of information:
Have these ready before you apply and you’ll be done in a few short minutes. When your EIN for an estate is ready, we will email you the results directly to your inbox.
More specifically, the social security number, or any other tax identification number that had been assigned to and used by the deceased party, immediately stops being valid for any taxation purposes at the moment of that person’s death. Instead, at that moment, a new taxation-status entity is born: that of the estate. Accordingly, that estate’s status becomes wholly separate, like that of a corporation or trust.
If there is a clear descendant, that person is generally in charge of handling all business in the name of the estate, which is assigned a new EIN. If there is not a descendant, an executor is usually assigned by the court. This person can be a more distant relative, a non-blood relative or even a friend of the deceased individual.
Whether you are a close family member or an executor appointed to oversee the estate, remember that you are responsible for paying taxes and dividing money to the rightful heirs until those situations has been fully resolved. When you pay the estate’s taxes, you are doing so on behalf of that estate, and not for the heirs. In cases in which the estate’s finances and business ties are complicated, the person representing the estate may want to consult with a tax attorney or tax accountant. In addition, you should remember to counsel the heirs if they are receiving money from the estate, as they almost certainly will be required to pay taxes on that.
Ultimately, you are responsible to the estate of the deceased individual, not to that person’s heirs.
Remember, also, that a trip to www.irs-ein-tax-id.com will answer all of your questions and help you handle your responsibilities quickly and accurately.