If you have a business in New York, you will need an Employer Identification Number (EIN)—also known as a Federal Tax Identification Number—to operate legally and to securely identify your business for tax responsibilities. Depending on the type of business you are starting, the EIN will be one of the first pieces of information you will need when establishing your business.

EIN's are assigned exclusively to businesses by the Internal Revenue Service (IRS). Businesses need an EIN to hire employees and to open a business bank account. Whether you are starting a sole proprietorship, for-profit or non-profit, corporation, S-corporation, or multi-member Limited Liability Company (LLC), an EIN is required to establish and establish credibility for your business in the marketplace.

What is An EIN?

An EIN is a nine-digit number assigned by the IRS to a business for tax filing and reporting purposes. It’s similar to a Social Security number assigned for an individual, but companies cannot use a Social Security number for tax purposes. Instead, they are required to have their own EIN.

An EIN is required if a business has employees or is incorporated as an LLC, corporation, or S-corporation. Even if you are a sole proprietor with no employees or plan to incorporate your business in the future, an EIN will need to be acquired before you can apply for business loans, open a business bank account, or complete other steps for creating your business.

How to Apply For An EIN

The application process for acquiring an EIN is simple, secure, and free of charge. Applications are processed in one business day and can be completed by mail, by fax, or through an online application.

Applying By Mail:

For those who need an additional layer of security against fraud, applicants may apply by mail. To do so, you must download, complete, print, and mail the IRS Form SS-4 to the address provided on the form. The form must be signed and dated before mailing. The IRS usually responds by mail within 4 weeks.

Applying By Fax:

You may also fax the completed IRS Form SS-4 along with the EIN application to the number listed on the form. The IRS may process your application with one business day and will notify you by fax to confirm that your EIN application has been accepted.

Applying Online:

Due to the increasing prevalence of cybercrime, the IRS now encourages applicants to take advantage of the secure online application process by using the online EIN application system. To apply, businesses must provide the requested information, answers a few questions regarding the type of entity, and click “Submit.” You should receive your EIN within one business day upon completion of the online application.

Important Considerations

You will need to keep your EIN for life and prove it any time the IRS requests it. Although your business will receive the EIN almost immediately, it could take up to an hour to have the number updated in the IRS database, and in some cases, up to two days.

When you have acquired your EIN, you can update the information anytime on the “Register My Business” page of the IRS website or contact the IRS directly for assistance.

When it comes to upstart businesses, New York State has some of the most business-friendly laws in the nation. As you navigate the business world, you will inevitably encounter legal and filing issues that require knowledgeable, experienced assistance. To ensure that your business is properly insured and complying with all applicable regulations, you may need the help of corporate lawyers, tax advisors, and other professional services.

The freelance and lawyer network of UpCounsel is a great resource for finding professional legal help for any business in New York. Network attorneys are experienced in the New York state and local laws and have worked with businesses of any size to provide high quality legal services at an affordable rate.

Topics:

EIN,

Employer Identification Number,

New York