A tax ID number (TIN) is a unique number that tax authorities issue to individuals and businesses to track tax responsibilities. In the United States, the most common types of TINs are the Social Security number (SSN) for individuals and the Employer Identification Number (EIN) for businesses. These numbers are required to file taxes, claim benefits, or complete transactions that involve tax reporting.

Businesses need TINs to stay compliant with tax regulations and complete tasks such as opening business bank accounts, hiring employees, and applying for business licences. The US Internal Revenue Service (IRS) and other agencies use your TIN to identify your business and track compliance with financial reporting requirements and tax obligations.

Below, we’ll explain the different types of TINs, how to determine which kind you need, and how to apply for it.

What's in this article?

• What is a tax ID number and why do you need one?
  
• Who needs a tax ID number?
  
• Why do you need a tax ID number?
  
• Types of tax ID numbers
  
• Determining the right tax ID number for you
  
• How to apply for an Employee Identification Number (EIN)
  
• How to obtain an Individual Taxpayer Identification Number (ITIN)
  
• What documents do you need to get a tax ID number?
  
• How long does it take to receive a tax ID number?
  
• How Stripe Tax can help
  

What is a tax ID number and why do you need one?

A tax ID number is how the government identifies your business. It tells tax authorities who you are when you pay taxes, file returns, and more. Here's why you should obtain a tax ID number.

To separate business from personal matters

If you operate as a sole proprietor, it can be tempting to use your Social Security number (SSN) or equivalent personal ID number. But doing so can blur the lines between your personal and business finances, which can cause complications when you do your taxes or if you are audited.

To protect your personal data

Relying on your personal tax ID number can put your data at risk. By using a dedicated business tax ID number on invoices, vendor forms, and other paperwork, you limit how widely your personal identifier circulates.

To build your credibility

Having a tax ID number signals that you’re serious about your business. Some banks won’t allow you to open a business checking account without an EIN or local equivalent.

To comply with regulations

Hiring employees, working with contractors, and obtaining certain licences or permits often require a tax ID number. Without one, you might face red tape or penalties.

Who needs a tax ID number?

Many types of organisations need a tax ID number, including the following.

Businesses with employees

In the US, you must get an EIN if you hire staff, and other countries have similar requirements for their local tax IDs. The US government uses this information to track payroll taxes, unemployment insurance, and other employer obligations.

Businesses that operate as separate legal entities

If you form a limited liability company (LLC), corporation, or partnership, you generally need a tax ID to demonstrate that your business is a distinct entity.

Sole proprietors who want to manage business finances separately

Even if you run a one-person operation, applying for a dedicated business tax identifier can still be a smart decision. It can protect your personal information and offer access to business-specific benefits such as lines of credit.

Non-profits or charities

Organisations that file for tax-exempt status often need a tax ID to register with the government. This is standard procedure to verify their legitimacy.

Trusts, estates, or other specialised entities

Some non-business entities are also required to have tax ID numbers. In some places, estates and trusts require their own identifiers to file taxes or manage assets.

Why do you need a tax ID number?

Although businesses primarily use TINs to file taxes, they also have other uses. Here’s why your business needs one.

Filing and reporting taxes

A TIN is how tax authorities track your business’s tax filings. Without it, your returns can’t be processed, which can lead to delays, increased scrutiny, and financial penalties. Filing taxes under an EIN instead of an SSN creates a legal separation between business and personal taxes.

Managing payroll and hiring

If you’re hiring employees, you need an EIN to report wages, handle employment taxes, issue W-2s, make payroll tax deposits, and comply with federal tax requirements such as Social Security and Medicare. Additionally, if you are managing independent contractors, you’ll also need their TINs (often SSNs or EINs) as well as your own TIN to issue 1099s. If you receive 1099 payments, you need a TIN to report those earnings to the IRS.

Opening business bank accounts

Banks typically won’t let you open a business account without a TIN – usually an EIN. This is important for separating business and personal finances and maintaining legal protections for LLCs or corporations. A dedicated business account can also simplify tracking and reporting for both financial management and tax purposes. Additionally, EINs and an established credit history are typically required if you’re applying for a loan or a business line of credit.

Establishing legal and financial identity

An EIN gives your business its own legal and financial identity. This is particularly important for LLCs, corporations, and partnerships, where personal and business liabilities need to remain separate. This distinction helps protect your personal assets.

Getting business licences and permits

Many states and local governments require an EIN before issuing business licences and permits, especially in regulated industries such as construction, retail, and food service.

Types of tax ID numbers

Here are the most common types of TINs and what businesses should understand about each.

SSN

An SSN is issued by the Social Security Administration (SSA). It’s primarily used for individual citizens and some residents. Generally issued shortly after someone is born, an SSN can also be applied for later in life by filling out an application and bringing it to a local SSA office with original identification documentation.

If they don’t have TINs, owners of some business types (e.g., sole proprietors, single-member limited liability companies [LLCs]) must use their SSNs to file taxes and certain information returns (e.g., 1099 forms). This can increase the business owner’s risk of identity theft, because the SSN is being used more often. Many small business owners choose to use an EIN to avoid giving out their SSNs to clients and other individuals or organisations.

EIN

An EIN is a nine-digit federal TIN issued by the IRS. Businesses use EINs on their tax returns, to issue 1099 forms, and to apply for business licences. EINs are required for all businesses that:

• Operate as a corporation or partnership, including multimember LLCs

• Hire employees, as an EIN is required to handle employment taxes

• File excise or alcohol, tobacco, and firearms tax returns

Individual Taxpayer Identification Number (ITIN)

An ITIN is issued by the IRS to individuals who need a TIN but are not eligible for an SSN. It’s typically used by non-US residents and nonresidents. An ITIN does not grant work authorisation or Social Security benefits and is strictly for tax filing purposes. Foreign business owners or investors might use an ITIN if they don’t qualify for an SSN and need to file US taxes. Similarly, businesses that hire foreign independent contractors who are not eligible for SSNs might need to use those contractors’ ITINs to report payments.

Nonresidents and foreign workers can apply for an ITIN by filling out IRS Form W-7 and submitting it by mail or in-person.

Preparer tax identification number (PTIN)

A PTIN is used by tax preparers and accountants who prepare or assist in preparing federal tax returns for compensation. Any tax professional who prepares or helps to prepare federal tax returns for pay must obtain a PTIN and renew their PTIN annually. This applies to certified public accountants (CPAs) and other tax professionals. If your business relies on the services of a tax preparer, you can check their PTIN to ensure they are authorised to file federal tax returns on your behalf.

Determining the right tax ID number for you

Choosing the right TIN depends on the nature of your business, how it’s structured, and what your growth plans are. Here’s what you should know.

Sole proprietors

If you're running a solo business without any employees, you can use your SSN as your tax ID. But some sole proprietors choose to get an EIN anyway, for privacy reasons. Using your SSN means you'll have to share it more than you normally would, which can raise privacy and security concerns.

As a sole proprietor, you should get an EIN if you want to keep your personal SSN more private or if your business grows to the point of hiring employees.

Single-member LLCs

Single-member LLCs that have not elected to be treated as corporations are treated as "disregarded entities" for tax purposes. This means they can file business taxes using the member's SSN. Some single-member LLCs choose to get an EIN regardless, either due to privacy concerns or to open a business bank account or apply for business credit.

As a single-member LLC, you should get an EIN if you plan to separate personal and business finances, you want to build business credit, or you plan to hire employees in the future.

Multimember LLCs and partnerships

Multimember LLCs and partnerships must get an EIN for tax reporting. This EIN is used to file information returns and issue Schedule K-1s to partners. If your LLC has multiple owners or is structured as a partnership, you need an EIN.

Corporations

Corporations must have an EIN to file corporate tax returns, issue stock, and handle employment taxes, if the corporation has employees. If you've incorporated your business, you need an EIN – no matter the size of the business.

Non-US residents and foreign-owned businesses

If you’re a non-resident or foreign national who owns a US-based business, you still need a TIN. In these cases, you’ll need to apply for an ITIN or an EIN to comply with IRS reporting requirements.

If you’re a foreign national who doesn’t qualify for an SSN but still needs to pay US income taxes, you need an ITIN. If you’re a foreign national who owns a US-based business that requires an EIN, such as a corporation or partnership, you need an EIN.

Businesses with employees

All businesses with employees need an EIN to report payroll taxes, file W-2s, and comply with federal and state employment laws. Federal and state tax IDs are typically issued separately, but both are required for identifying and tracking businesses for tax purposes.

Independent contractors

If you're working as an independent contractor or freelancer and don't have employees, you can still use your SSN to file taxes. If you're a contractor who wants an extra layer of privacy for tax reporting purposes, you can get an EIN.

How to apply for an Employee Identification Number (EIN)

Applying for an EIN is a straightforward process, and there are a few different ways to do it. Here's how to get a taxpayer ID in the US.

1. Determine if you need an EIN

Before applying, ensure you need an EIN. Generally, you'll need one if:

• You have employees

• You operate as a corporation or partnership

• Your business files tax returns for employment, excise, or alcohol, tobacco, and firearms

• You withhold taxes on income (other than wages) paid to a non-US nonresident

• You have a tax-deferred retirement plan formerly known as a Keogh plan

• You're involved with certain organisations such as estates, trusts, and non-profits

2. Gather required information

Before applying, ensure you have the following information ready:

• Legal name of the business owner or entity: If you're applying as a sole proprietor, this is your own name. If it's for an LLC, corporation, or partnership, use the legal business name.

• Trade name: If your business operates under a different name than the legal one (a DBA or "doing business as" name), you'll need to include that as well.

• Responsible party's SSN or ITIN: This is typically the individual who controls the business (often the business owner). Their personal SSN or ITIN is required for the application.

• Business address: The principal address where the business operates.

3. Choose your application method

Online

You can apply for an EIN online directly through the IRS website if your principal business is located in the US or its territories. This is the fastest method and gives you an EIN immediately after completing the application. To apply online, go to the IRS EIN online application page and follow the instructions. Once you submit the application, you'll receive your EIN instantly. The online service is available Monday through Friday from 07:00 to 22:00 ET.

By post

You can also apply for an EIN by mailing a Form SS-4. To apply by mail, you'll need to download and complete Form SS-4 and mail it to the IRS. If your principal business is located in one of the 50 states or the District of Columbia, mail the form here. Processing time is about four weeks, so consider this option if you don't need the EIN urgently.

By fax

If you prefer to fax your application, this is another option that takes about four business days to process. To apply by fax, download and complete Form SS-4 and fax it to the appropriate number. If your principal business is located in one of the 50 states or the District of Columbia, fax the form here: +1 855 641 6935. You'll typically get your EIN back via fax within four business days.

By phone (for international applicants)

If you're applying for an EIN from outside the US, you can apply by phone. To apply by phone, complete Form SS-4 and have the information ready. Call the IRS at +1 267 941 1099 (not a toll-free number). The office is open Monday through Friday from 06:00 to 23:00 ET. You'll typically receive your EIN at the end of the call.

4. Wait for confirmation and keep your EIN safe

If you applied by post or fax, you’ll need to wait four weeks or four business days, respectively, to receive your EIN. Once you receive the EIN, it’s effective immediately and you can start using it for activities such as opening business accounts, hiring employees, and filing tax returns.

Once you get your EIN, keep it somewhere secure. The IRS will not issue a replacement EIN, so if it’s lost, you’ll need to contact the IRS to retrieve it.

5. Make changes as necessary

If there are changes to your business such as switching from a sole proprietorship to an LLC, changing ownership, or restructuring, you might need to apply for a new EIN. In other cases, such as changing your business address, you can update your existing EIN information with the IRS rather than apply for a new one.

How to obtain an Individual Taxpayer Identification Number (ITIN)

Individuals who aren’t eligible for an SSN but need to comply with US tax laws must obtain an ITIN. This includes non-US residents and non-residents, foreign investors, and other individuals who have to file US tax returns. Here’s a step-by-step guide to applying for an ITIN.

1. Determine if you need an ITIN

An ITIN is required if:

• You are a non-US nonresident who must file a US tax return

• You are a non-US resident who must file a US tax return

• You are a dependent or spouse of a US citizen, non-US resident, or nonresident visa holder

• You are a non-US nonresident who needs to claim a tax treaty benefit

• You are a non-US nonresident student, professor, or researcher filing a US tax return or claiming an exception

If you are eligible for an SSN, you cannot apply for an ITIN. You must apply for an SSN through the SSA.

2. Gather the necessary documents

To apply for an ITIN, you’ll need to submit the following documents:

• Completed application form: Form W-7 is the ITIN application form. You’ll provide basic information including your name, country of citizenship, US visa (if applicable), and reason for applying for the ITIN.

• Valid federal tax return: Unless you qualify for an exception, you’ll need to attach a valid federal income tax return to your Form W-7.

• Original supporting documents or certified copies: You’ll need to submit original documents or certified copies from the issuing agency. Acceptable documents include the following:

  • Passport (this can serve as both your proof of identity and foreign status)
    
  • National ID card (this must show photo, name, address, date of birth, and expiry date)
    
  • US visa, foreign voter’s registration card, or other immigration documents, if applicable
    
  • Birth certificate, if you’re applying for a child who will be claimed as a dependent on a tax return
    

You’ll need to submit original documents, such as your passport, or copies certified by the issuing agency. Photocopies that are not certified won’t be accepted. You might be able to request a certified copy of documents at an embassy or consulate if you’re not in the US.

3. Complete Form W-7

Form W-7 is your formal application for an ITIN. Here’s how to complete it:

• Provide personal information such as your name, address, and country of citizenship.

• Indicate your reason for applying for an ITIN (e.g., filing a tax return, claiming tax treaty benefits).

• Enter any additional information related to dependents, if applicable.

• Sign and date the form before submission.

4. Submit your application

By post

You can post the completed Form W-7, along with your federal tax return and supporting documents, here:

Internal Revenue Service
ITIN Operation
PO Box 149342
Austin, TX 78714-9342

You will usually receive a letter from the IRS assigning your ITIN within seven weeks.

In person

You can apply for an ITIN in person through an IRS Taxpayer Assistance Center or an IRS-authorised Acceptance Agent or Certifying Acceptance Agent (CAA). These agents can verify your documents so you won’t have to post originals, which can be helpful if you don’t want to send your passport or other important documents through the post.

Use the IRS locator to find a Taxpayer Assistance Center near you. Alternatively, you can find a CAA through the IRS website.

5. Wait for processing

Once you submit your application, it usually takes about seven weeks to receive your ITIN if there are no issues with your paperwork. During peak tax season, this could take longer. If you applied through a CAA or in person, the process might be quicker, since your documents have already been verified.

6. Use your ITIN for tax filing

Once you receive your ITIN, you can use it to file US tax returns, claim treaty benefits, or fulfil other tax obligations. The ITIN is purely for tax purposes, and it does not authorise you to work in the US or make you eligible for Social Security benefits.

7. Renew or update your ITIN as needed

Your ITIN will expire if it hasn’t been used on a tax return for three consecutive years or if it was issued before 2013 and hasn’t been renewed. If your ITIN expires, you’ll need to renew it using Form W-7 and the same process.

What documents do you need to get a tax ID number?

The exact requirements vary by country, but here’s a general list of what you will need to apply for a tax ID.

Personal ID

If you’re the responsible party, expect to provide your government-issued identifier, such as your SSN in the US. In some cases, you might need a personal taxpayer ID if you’re not a citizen or resident.

Business registration info

If you’ve registered your business name or formed a legal entity, have those documents or registration numbers at hand. They verify your company exists and confirm its structure.

Postal address and contact details

You’ll need to specify a place where official letters can be sent. This address might be different from your primary physical location (e.g., if you have official notices sent to a registered agent at a different address).

Nature of your business

Tax authorities will want to know what your organisation does, and you might need to select a category or code that reflects your primary activity. For example, if you run an online clothing store, you might select the retail or e-commerce category.

Date the business started

Some forms will also ask when your operation began or when you hired your first employee to confirm whether you’re at the right stage to apply.

Authorised signatory details

If you’re not the owner but an executive or manager authorised to apply, your details might also be required to apply.

How long does it take to receive a tax ID number?

The length of time it takes to receive your ID varies widely by region and by application method. In the US, applying online can get you your EIN immediately, while filing by mail can take a few weeks. Other countries have their own timelines. Here are some examples:

• Businesses in Canada can register for a business number (BN) online and receive it immediately.

• Businesses in the United Kingdom are issued a Unique Taxpayer Reference (UTR) after they register. They typically receive it by mail within 15 days.

• Businesses in Australia can apply for an Australian Business Number (ABN) online and receive it immediately.

If you have an urgent need for a tax ID, consider online or phone options to avoid paper handling and postal delays.

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