Do I Need An EIN If I’m Filing For A Sole Proprietorship?

Back to FAQs

 

An employer identification number, also known as an EIN or federal tax identification number, is a nine-digit set of unique numbers assigned to your company and used by the Internal Revenue Service (IRS) to identify your business for tax-related purposes.

The Need and Importance of an EIN

The IRS wants company owners to apply for an EIN online under certain circumstances, including if they have workers, are part of a Keogh plan or are involved with trusts, estates, non-profits, farmers’ cooperatives, or plan administrators. They should also file if they operate as a partnership or corporation, or withhold taxes on income, other than pay, for a non-resident alien.

Banks may require a business to have an employer identification number to open a business banking account.

What Is a Sole Proprietorship?

A sole proprietorship is a company that has a sole owner not registered with the state as a corporation or limited liability company. This entity type is affordable and relatively easy to establish. You don’t have to file paperwork in order to get it set up.

Do I Need an EIN for a Sole Proprietorship?

It is not necessary to obtain an EIN for sole proprietorship. This is because you can use your social security number. However, many business owners choose to obtain an employer identification number to protect them from giving out their social security numbers. If you have hired an employee, an EIN is required.

EIN Online Application

If you want an EIN for a sole proprietorship, then you can easily apply for one online with our fast and secure application.

Select Your Entity Type to Apply for a Federal Tax ID Today