What Does the IRS Have to Do With an EIN?

An EIN is similar to a social security number. It’s a unique nine-digit number assigned to businesses and other entities for tax reporting purposes. This number is also used in the creation of pension plans and for opening business bank accounts. If your business is classified as a Corporation, Partnership, LLC or S corporation, the IRS uses the number to identify the taxpaying entity and the various tax returns you are required to file. However, unlike social security numbers, the IRS-EIN-Tax-ID is not considered sensitive information.

Non-Profit and Other Entities


Although a single organization, each chapter of a non-profit must have its own EIN for proper registration. The central or governing body of the organization may file for group tax exemption. The IRS recommends that you verify a charitable organization’s status and registration before donating. Tax-exempt status can be revoked if the required IRS forms have not been filed for three consecutive years.


Estate Administrators


When you die and leave behind property, money or other assets, it is likely that there will be an estate executor or administrator. This person or entity is responsible for managing the estate which includes collecting your assets, ensuring the appropriate heirs and beneficiaries receive the amount and items they are entitled.


 Before distributing the estate, the executor must obtain an estate EIN, also known as a Federal Tax ID number. In addition, the administrator is also charged with paying any creditors that may have a claim to the estate. Tax returns for the current year, as well as any years the taxes were not paid before your death, must be efiled. If your business continues operation through the estate, a new EIN must be secured and used to report wages and income as well as report and pay the new taxes that are due.

Contact us for more information on how to apply for an EIN number. Govt Assist agents can expedite the application so that you receive your new Federal Tax ID number via email the same day.

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