Can You Get an EIN Before Incorporating?
Can you get an EIN before incorporating? You must incorporate your business before applying for an employer identification number with the IRS.3 min read
Can you get an EIN before incorporating? You must incorporate your business before applying for an employer identification number with the IRS. Form SS-4, which is the EIN application, indicates that the name of the applicable business entity must be entered exactly how it appears on incorporating documents. Incorporating before the EIN application allows you to include your business's exact legal name. However, if you own a sole proprietorship or partnership and don't currently plan to incorporate, you can use your Social Security number for tax purposes and to register for an EIN. If this changes in the future, you can update the necessary authorities.
What Is an EIN?
The employer identification number, along with your business license, is one of the more important documents for your new business. While you must have articles of incorporation in hand when applying for your EIN, you do not necessarily need to have your business license. However, this depends on your jurisdiction. If you have a sole proprietorship, you can use your Social Security number to pay taxes for your business.
If you plan to incorporate or hire employees in the future, you'll need an EIN. If you have a sole proprietorship or partnership, and are using your Social Security number for taxation, you must notify tax authorities, banks, and creditors if you do register for an EIN down the road. This is especially important for your business to remain in compliance with federal, state, and local labor and wage requirements.
How Do You Apply For an EIN?
You can quickly and easily apply for an EIN online by filling out the digital version of Form SS-4. In some cases, the IRS may request a faxed version of the form along with your company's articles of incorporation for verification purposes. To be eligible, you must already have either a Social Security number or individual taxpayer identification number (ITIN), and your business must be located in the United States.
- Visit the IRS website.
- Select the File tab and then click Popular to find a link where you can apply for an EIN.
- Carefully read the IRS information and recommendations on each screen.
- Click on the Apply Online Now link.
- The next screen will provide instructions for completing the application.
- Select the business entity that describes your company.
- Confirm your selection and click the arrow to continue.
- Add details about the state where your business is located and the number of employees you have.
- Confirm that this information is correct on the next screen.
- State why you're registering for an EIN, whether it's to open a new business or business bank account.
- Select the responsible party for your company. This can either be an individual or a business that already has an EIN. This information will not be made public.
- If you are the responsible party, you'll need to enter your full legal name and either your SSN or ITIN. Indicate whether you're an owner of the company or a third party acting on the owners' behalf.
- Enter the legal name of your business and the state and county where you operate.
- Answer the series of yes or no questions on the next pages honestly and correctly.
- Indicate the industry in which your business operates.
- On the next screen, you'll be asked to provide more detail about your business activities.
- Choose whether to receive your confirmation letter through email or postal mail.
- Confirm your information and submit your application.
How Do You Apply For a Business License?
The rules for your business license are established by the county and city where your business is located. You may need a license associated with zoning, sales tax, or other purposes. In a few states, like Washington, business licenses are issued at the state level and are consistent for all municipalities.
In some municipalities, an EIN or tax identification number (TIN) will be required on your business license application. If you have not yet registered for an EIN, your Social Security number will suffice. You may also have to list the TIN or SSN of all the directors, officers, and owners of the business depending on the state and local laws.
If you need help with obtaining an EIN before incorporating, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.