An employer identification number, also known as an EIN or federal tax identification number, is how the IRS identifies your business as an operating entity within the United States. Company owners use this nine-digit number to conduct activities that would otherwise need a social security number.
When Do You Need an EIN?
You will need to apply for EIN if:
-You have employees.
-You have a Keogh Plan.
-Your business operates as a partnership or corporation.
-You’re involved with certain types of organizations, such as estates, non-profits, or real estate mortgage companies.
How Do I Cancel My EIN?
If for some reason you need to cancel your employer identification number after it has been assigned, the IRS cannot do it for you. After an EIN is assigned to a company, it becomes the permanent federal taxpayer ID number for that business entity. The employer identification number will never be reassigned or reused.
Despite the fact that the Internal Revenue Service cannot cancel your EIN, it can close your business account. To achieve this, simply send the IRS a letter that includes the name of your company, the EIN, the business address, and why you wish to close the account. If you have a copy of the EIN Assignment Notice, which you got when you initially registered for EIN, include that as well.