An Employer Identification Number, often called an EIN, is a unique, nine-digit code used by the Internal Revenue Service for tracking the tax responsibilities of legal entities in the United States. EINs function like Social Security Numbers (SSN) for individual taxpayers; and like all taxpayers, only one EIN is required per legal entity. However, there are instances when a business owner may need multiple EINs, which is why some of our clients have asked us, “Can I have more than one EIN?” Below we will answer this question in more detail.
The short answer to this question is, yes. It is possible, and may be necessary, to have multiple EINs in the case you (the business owner) own multiple partnerships and need more than one partnership tax ID, corporations, limited liability companies, or other legal entities (i.e. trusts, estates, etc.), which would require independent identification by the IRS for tax purposes.
Every separate, legal entity should have it’s own EIN. A legal entity is defined by its ability to engage in contracts, agreements, incur and pay debts, and to be held liable for its independent actions. Associations, non-profits, corporations, and partnerships are different types of legal entities.
If you find that you are in need of an EIN, the fastest and easiest way to obtain this federal tax ID number is to apply for an EIN online. You can get a federal tax ID no matter where you are located, such as a Tennessee tax ID.
Other EIN application methods can take up to two weeks to complete. If you apply for an EIN online, you’ll get the results delivered to your inbox within 1-2 business days; plus, you can check your EIN number online anytime you want to review your order, or in the event you lose or misplace your EIN.
If you’re still wondering, “Can I have more than one EIN?” you should consider reviewing your personal assets and business holdings to ensure you’re prepared.
There is no legal limit to the number of separate businesses an individual or entity can own and operate, and there is likewise no limit to the number of EINs you can apply for. The only stipulation is that each new EIN is appropriated for a separate and distinct entity.
For example, if you are a clothing manufacturer and you open a business division that handles all the buttons and zippers for the factory, you would not need a separate EIN number for the new accessories division. However, if you own multiple businesses that are not inter-related, you can apply for multiple EIN numbers – one per business entity.
A fictitious business name, also called an assumed name or DBA (“doing business as”), is a name you call your business, but is not the official or legal name of your company. It allows a person who owns three different-themed restaurants, for example, to operate them under different names, a common business practice.
A company can use a single EIN for multiple sub-divisions which are not established as legally separate businesses. Remember that the IRS is interested in the taxes withheld from the company’s employees, and in the taxes paid by the company, not in whatever name it uses on its business cards.
Whether you use one fictitious business name or dozens, you are covered by a single EIN number because the IRS assigns Employer Identification Numbers based on the official legal name of a business only.
The only legal requirement for fictitious names is that DBAs be registered by the state so consumers and others can find out exactly who owns the company.
Therefore, you will be required to obtain an additional EIN number for each new legally distinct subsidiary of the company, but not for new divisions, branches, offices, stores, or names.