Most people only think about how to get a tax ID when they’re already under pressure — starting a business, opening a bank account, or filling out a form that won’t move forward without it. The good news is that the process is more straightforward than it looks, and once you understand what type of ID you actually need, the rest falls into place quickly.
Tax ID types: they’re not all the same thing
Before you take any steps, it’s worth being clear on terminology. In the United States, “tax ID” is an umbrella term that can refer to several different numbers depending on who’s applying and why.
- SSN (Social Security Number) — issued to U.S. citizens and eligible residents through the Social Security Administration. This is the most common individual taxpayer identifier.
- EIN (Employer Identification Number) — used by businesses, nonprofits, estates, and trusts. Assigned by the IRS.
- ITIN (Individual Taxpayer Identification Number) — for individuals who aren’t eligible for an SSN but still have a U.S. tax filing obligation.
- PTIN (Preparer Tax Identification Number) — required specifically for paid tax preparers.
Knowing which one applies to your situation saves you from wasting time on the wrong application entirely.
Getting an EIN for your business
If you’re setting up a business entity — an LLC, corporation, partnership, or even a sole proprietorship that hires employees — an EIN is what you need. The IRS issues it for free, and the online application through the IRS website is the fastest route available.
The IRS online EIN application is available Monday through Friday, and once completed correctly, the number is issued immediately at the end of the session.
Here’s how the process works step by step:
- Go to the official IRS website (irs.gov) and find the EIN application section under “Apply for an Employer Identification Number.”
- Select the type of legal structure that matches your business.
- Identify the responsible party — the individual who owns or controls the entity.
- Answer questions about the reason for applying and the nature of the business.
- Submit the application and receive your EIN immediately on screen.
If you can’t use the online system, alternative methods include applying by fax (Form SS-4) or by mail. Fax typically takes about four business days; mail can take several weeks.
Applying for an ITIN when an SSN isn’t an option
Foreign nationals, non-resident aliens, and certain visa holders who earn income in the U.S. or need to file a tax return but don’t qualify for an SSN can apply for an ITIN. This number is strictly for tax purposes and doesn’t authorize work or provide eligibility for Social Security benefits.
The application requires submitting Form W-7 to the IRS along with original documentation — or certified copies — that prove both identity and foreign status. A passport is the single document that satisfies both requirements. The form can be submitted by mail, in person at an IRS Taxpayer Assistance Center, or through an IRS-authorized Acceptance Agent.
| Document Type | Proves Identity | Proves Foreign Status |
|---|---|---|
| Passport | Yes | Yes |
| National ID card | Yes | Yes (if issued by a foreign government) |
| U.S. driver’s license | Yes | No |
| Foreign voter registration card | Yes | Yes |
Processing an ITIN application typically takes seven weeks when submitted during non-peak periods, and up to eleven weeks during tax season.
A few things people often get wrong
There are some recurring mistakes worth flagging — not because they’re hard to avoid, but because they cause unnecessary delays.
Using a third-party service that charges a fee for EIN registration is never necessary. The IRS application is free, and there’s no legitimate reason to pay someone just to fill out that form.
- Applying for the wrong type of number. A sole proprietor with no employees doesn’t always need an EIN — an SSN may be sufficient for tax filing purposes.
- Submitting incomplete or inconsistent information on Form SS-4 or W-7, which leads to rejection or processing delays.
- Using an ITIN where an SSN is required — employers, for example, cannot accept an ITIN for payroll purposes.
- Letting an ITIN expire. ITINs not used on a federal tax return for three consecutive years expire and must be renewed before they can be used again.
State-level tax IDs and when you need one
Beyond the federal level, many businesses also need a state tax identification number — sometimes called a state EIN or state taxpayer ID. This is separate from the federal EIN and is issued by the state’s department of revenue or taxation.
You’ll likely need one if your business collects sales tax, has employees subject to state income tax withholding, or operates in a state that requires it for specific licensing purposes. Each state has its own registration process, usually available through the state’s official tax agency website.
Some states assign a tax ID automatically when you register your business entity through the Secretary of State’s office. Others require a separate application. Checking the requirements for the specific state where your business operates is an important step that’s easy to overlook.
Where to keep your tax ID and how to use it safely
Once you have your number, treat it like sensitive financial information — because that’s exactly what it is. Tax ID numbers, especially EINs, are frequently targeted in identity theft schemes where fraudulent tax returns or credit applications are filed in a business’s name.
- Store your EIN confirmation letter (CP 575) securely — this is the official IRS document confirming your number.
- Only share your tax ID with verified parties: banks, accountants, government agencies, and vendors who legitimately require it for 1099 reporting.
- If you suspect your EIN has been compromised, contact the IRS immediately.
The EIN is a public record to a degree — it appears on business filings and tax forms — but that doesn’t mean it should be casually shared or posted anywhere unnecessarily.
Getting started is simpler than waiting
A tax identification number isn’t something to put off until a deadline forces your hand. Whether you’re launching a business, navigating a cross-border tax situation, or just getting your financial paperwork organized, having the right number in place opens doors — to banking, contracts, and compliance — that would otherwise stay closed. The application itself takes minutes for most people. The real work is just knowing which one you need.
