How to obtain a tax ID number for an LLC

Once an LLC is registered with the appropriate state government agency, usually the secretary of state, the entity's owner must decide whether they wish or need to secure an Employer Identification Number (EIN) from the Internal Revenue Service.

LLCs without employees don't need to obtain an EIN to do business as they may file the business' taxes using the owner's Social Security Number (SSN). However, once an LLC hires its first employee, an EIN is required for the entity to file taxes.

Determine eligibility

The first step to securing an EIN is determining whether your entity qualifies for one under IRS guidelines:

• You may apply for an EIN if your principal business is located in the United States or a U.S. territory.
• You must provide a valid taxpayer identification number, such as a SSN or EIN.
• Only one "responsible party" may apply for an EIN per day.

The IRS defines a responsible party as someone with ultimate control over the business enterprise.

Moreover, while an EIN seeker need not be a U.S. citizen, foreign applicants may not apply online. American citizens may seek an EIN using an online application.

Applying for an EIN

The application for an EIN is found on the IRS website. It is important to note that the application must be completed in one sitting and generally takes about 15 minutes.

It cannot be saved for future revisions, so set time aside to respond to all questions fully. For those who prefer to apply over the telephone, contact the IRS at (800) 829-4933 and select EIN from the list of options.

Applying online allows for the immediate assignment of an EIN, while other methods result in time delays.

Information needed for an EIN application includes:

• Names and SSNs of owners
• Name of the responsible party of the LLC
• Name, address, and trade names of the LLC
• Date the LLC was started
• LLC's principal line of business
• LLC's expected number of employees

An EIN identifies an entity for IRS purposes. Once secured, the EIN is used to secure business banking, apply for necessary licenses and permits, and file company tax returns.