When someone passes away leaving behind assets that collect income (i.e. savings account, stocks, bonds, mutual funds, rental property, etc.), it’s up to the family, or the executor of the estate, to begin the process of managing the estate assets. Obtaining an EIN for an estate vs. EIN for a business requires the same filing process, minus a few minor details within the EIN application itself.
EIN for an Estate vs. EIN for a Business
The Internal Revenue Service (IRS) uses Employer Identification Numbers (EIN) to track the tax obligations of various legal entities in the US.
When someone starts a business, the business owner may elect to form an entity that is legally separate from himself to avoid liability issues. This also allows the business owner to take advantage of tax benefits only certain types of businesses can enjoy. A business EIN number is like a Social Security Number (SSN) for a business or legal entity.
Alternatively, an EIN for an estate is needed after someone passes away for family members that are left to handle the estate (income-generating assets left by the deceased), which can no longer be reported using the deceased’s SSN.
Family members, or the estate’s executor, must report any income generated by the deceased’s estate on Form 1040, which is an Income Tax Return for Estates and Trusts. An EIN is required to complete this from.
Get an EIN for an Estate
There are several ways to get an EIN for an estate including by mail, phone, or fax. However, the fastest and easiest way to get one is to apply for an EIN online.
Our online application is simplified and expedited to get you the results you need faster and with less frustration than other application processes. Plus, you can check your EIN status online anytime you want to review the order, or to recover a misplaced or lost EIN number.
The only difference between EIN for an estate vs. EIN for a business is the circumstances leading up to the application process.