An EIN Makes Filing Taxes for Your Side Hustle or Business Easier. How to Get One

An image to accompany a story about employer identification numbers
Consider getting an Employer Identification Number to avoid hiccups when registering your business, opening a business bank account, or applying for financing.
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Best pricing for simple filings
ZenBusiness
From $0, plus government filing fees
Jump to details
Good for Speedy Checkout
Swyft Filings
From $49, plus government filing fees
Jump to details
Best for business and personal filings in one place
LegalZoom
From $79, plus government filing fees
Jump to details
Best for step-by-step guidance
Northwest Registered Agent
From $100, plus government filing fees
Jump to details

An Employer Identification Number (EIN) is easy and free to obtain, and having one will make filing taxes for your side hustle or small business much easier.

Millions of Americans start a business each year. In August 2022 alone, over 420,000 new business formations were filed, according to a press release from the United States Census. One of the steps you must take in the business formation process is signing up for an EIN. Experts say that doing so will both ensure compliance on taxes and give entrepreneurs peace of mind.

“[An EIN] helps them understand that their business really is a business with the potential to grow, rather than just a grueling function they must perform every day,” says Eva Rosenberg, Enrolled Agent and Founder of TaxMama, an online hub for tax professionals. When you have an EIN, you can sign up for business checking accounts, credit cards, and lines of credit that are completely separate from your personal finances, giving you an added layer of liability protection.

Most banks require an EIN to set up a business account. Some services offer to register an EIN for you for a fee, but you can do it yourself quickly and at no cost. For other business filings, however, you may want to work with an online service provider to get the job done quickly and easily.

Best pricing for simple filings
ZenBusiness
ZenBusiness
Best pricing for simple filings
ZenBusiness
Learn More externa link icon
  • Price:
    From $0, plus government filing fees
  • Additional help available:
    Yes
  • State-specific checkout:
    Yes
Overview:

When you’ve helped launch over 300,000 businesses, you know you’re doing something right.

ZenBusiness is a Public Benefit Corporation (PBC), a type of corporation that generates services that contribute to the public good, and agrees to operate sustainably and responsibly. The Austin-based company is also a unicorn, last valued at $1.7 billion in November 2021. ZenBusiness’ website includes recommended resources for women and BIPOC business owners, along with clear statements on diversity, equity, and inclusion. ZenBusiness also has an “excellent” rating on TrustPilot, based on the average of the over 10,000 reviews it has received from customers.

Most notably, however, the company’s Starter package will let you file the essentials for free, plus the cost of state filing fees.

Starter package

  • Standard filing service: ZenBusiness team will file and return your completed documents with the state.
  • Standard filing speed: ZenBusiness will process and return the completed state documents, based on when the order is received, as well as the backlog the state is working through at that time. This can range from a few days to a few weeks, depending on the state.
  • Expense and deduction tracking: Each Starter package includes a free Money Essential tool that allows customers to easily track expenses and tax deductions for improved accounting and easier tax return preparation.
Good for Speedy Checkout
Swyft Filings
Swyft Filings
Good for Speedy Checkout
Swyft Filings
Learn More externa link icon
  • Price:
    From $49, plus government filing fees
  • Additional help available:
    Yes
  • State-specific checkout:
    Yes
Overview:

Swyft Filings has helped over 250,000 business owners in all 50 states with filings since its inception in 2015. Founded by a lawyer, the company’s services assist with LLC formation, DBAs, registered agents, and S corporation elections. They also work with new and established nonprofits. Continued support or professional guidance is available after you file if you want a helping hand.

The company is focused on business filings only, and does not offer personal legal counseling. Swyft Filings has a 4.8/5 rating from over 5,300 reviews on Trustpilot, a reviews aggregator service. The company has formation-specific FAQ sections, live chat, and a toll-free phone number you can call if you want to speak to someone personally. As its name suggests, Swyft Filings’ website is lightning fast and easy to navigate.

Best for business and personal filings in one place
LegalZoom
LegalZoom
Best for business and personal filings in one place
LegalZoom
Learn More externa link icon
  • Price:
    From $79, plus government filing fees
  • Additional help available:
    Yes
  • State-specific checkout:
    Yes
Overview:

LegalZoom helps you set up an LLC in your state quickly, easily, and entirely online. An LLC is needed for important business functions, such as opening a business bank account. Different states have different business formation requirements; LegalZoom customizes the process for you based on what state you live in, and the company helped consumers form 447,000 businesses in 2021, according to a press release.

Mistakes can be made when trying to form an LLC by yourself, and business formation professionals can be expensive. If you want a cost-effective and convenient way to create your LLC (and keep more of the money you make from your side hustle or business when tax time rolls around), LegalZoom is a great option.

Best for step-by-step guidance
Northwest Registered Agent
Northwest Registered Agent
Best for step-by-step guidance
Northwest Registered Agent
Learn More externa link icon
  • Price:
    From $100, plus government filing fees
  • Additional help available:
    Yes
  • State-specific checkout:
    Yes
Overview:

Northwest Registered Agent became popular for its $39 LLC formation service, which it offered in its early years. It’s also well known for its commitment to customer service; the company’s tagline is “We’re just not annoying”, and the website manifesto outlines the family-owned business’ commitment to communication and transparency. Northwest Registered Agent’s website makes checkout very simple, and it automatically directs you to state-specific filing details, making it easy to customize your order.

A handy feature of Northwest Registered Agent’s checkout process is that you don’t totally need to know everything you might need or want from a filings perspective when you sign up. The guided checkout process explains filings as you go, allowing you to customize your order and ensure you’ve set yourself up for success.

Here’s what to know about registering for an Employer Identification Number, otherwise known as an EIN.

What Is an Employer Identification Number?

Also referred to as a Federal Tax Identification Number (FEIN), an Employer Identification Number is a unique nine-digit number issued by the IRS

What is an EIN good for? An EIN is used to identify business entities with the Internal Revenue Service for tax purposes. This federal tax ID number comes with several perks.

Why Is an EIN So Important, and Do I Need One?

Depending on the business structure you select, you may not be required to obtain an EIN when starting a business. Still, it may be in your best interest to get one. 

“We always recommend that new business owners obtain an EIN, as it allows them to discontinue usage of their Social Security Number on official business documents,” says Dane Janas, Enrolled Agent with Moravia Advisors, a tax advisory and bookkeeping firm. “Nobody likes to give out their Social Security number more than they have to, and an EIN allows you to

have the same functionality with a separate registration number completely dedicated to your business.” 

In addition to keeping your Social Security number secure, having an EIN can also make it easier to register your business and get operations up and running. Independent contractors should also consider incorporating and registering for an EIN. 

“You can open a new business bank account, register your business, and more with your new EIN,” says Janas. “If you do not plan to hire employees in the next year after your new business is formed, then an EIN is technically not required by IRS regulations, although we always recommend that new businesses obtain one anyway. If you plan to hire employees, obtaining an EIN is a requirement, as you need an EIN to complete various payroll tax registrations.”

According to the IRS, you must apply for an EIN if any of the following apply: 

  • You have one or more employees. 
  • You operate your company as a partnership or corporation. 
  • You file tax returns for goods that include alcohol, employment, firearms, or tobacco, or pay excise taxes. 
  • You withhold taxes on income paid to a non-resident alien. 
  • You have a Keogh plan, which is a retirement plan for people who are self-employed.
  • You’re involved with an estate, farmers’ cooperative, non-profit organization, plan administrator, or real estate mortgage investment conduit or trust (with the exception of trusts that are revocable and grantor-owned). 

You may also need an EIN in order to secure certain business licenses that allow you to operate in your particular state.

Pro Tip

You can technically start a business without an EIN, but doing so will classify you as a sole proprietor. Sole proprietors’ personal assets are at risk; if a client or patron were to sue your business, your personal assets could be up for grabs to pay damages. Forming a corporation or a limited liability company (LLC) instead will give you additional liability protection.

If your business is just you, have no fear: you can choose to set up a single-member LLC. In this LLC, you are the 100% owner of the company, and you can file your business taxes together with your personal taxes all in one return if you so choose.

What’s the Difference Between EIN, TIN, FEIN, and DUNs?

The terms EIN and Federal Employer Identification Number (FEIN) are often used interchangeably since they serve the same purpose. They refer to the same nine digit identification number.

In contrast, a Taxpayer Identification Number (TIN) or Individual Taxpayer Identification Number (ITIN) is a number issued by the IRS to select residents or nonresident aliens, their spouses, and their dependents who aren’t eligible for a Social Security number.

DUNS (Data Universal Numbering System) numbers are also nine digits long, but serve a different purpose. They are issued by Duns & Bradstreet (D&B) to businesses, and are used by lenders or other entities interested in doing business with you to gain insights into your company’s financial health.

How Do I Apply for an EIN, and How Are They Assigned? 

If you have a Social Security number, you can apply for an EIN online using the EIN Assistant tool found on the IRS website. Still, it could be in your best interest to solicit professional assistance. 

“The process of getting an EIN for a newly incorporated business is pretty straightforward on the IRS website, and does not necessarily require an attorney or an accountant to assist, unless the business owner needs special assistance,” says David Reischer, Esq., business attorney at LegalAdvice.com. “It is not uncommon for an accountant to apply for an EIN when there is a newly formed entity and roll the cost of such minimal efforts into first-year tax filing fees.”

If you decide to apply on your own, here’s how to move forward: 

  • Access the EIN Assistant tool. Be sure to have your SSN or TIN handy. 
  • Complete the online application. 
  • Submit the completed form.
  • Get your EIN and print or download the form to your device. 

You are limited to one EIN application daily. The EIN Assistant tool is available Monday through Friday from 7am to 10pm EST. Also, note that you will be logged out after 15 minutes of inactivity, so completing the application in one sitting is highly recommended. If you file online, you will receive your EIN immediately.

If you don’t have a Social Security number, the IRS also accepts applications for EINs by fax or mail using Form SS-4: Application for Employer Identification Number. You can also apply by phone.

EINs are assigned by one of 10 IRS campuses, the internet, or the U.S. Small Business Administration (SBA). The campus or location responsible for issuing the EIN is noted in the EIN prefix, which is the first two digits of your nine-digit number. 

Frequently Asked Questions:

Can I get an EIN for free?

Yes. You can get an EIN free of charge through the EIN Assistant Tool found at IRS.gov.

How long does it take to get my EIN?

It depends on the method you use to apply. Online applicants receive EIN numbers immediately. Applying by fax means you’ll have to wait several days for a response, assuming you follow the instructions on the form and there are no processing delays. The waiting period if you apply by mail is four weeks. International applicants applying by phone receive their EIN at the conclusion of the phone call with the agent.

Do I need an EIN if I’m an independent contractor?

You should consider getting an EIN. Independent contractors are automatically classified as sole proprietors unless they file otherwise. Sole proprietorship doesn’t come with the same protections that other business formations, such as a corporation or a limited liability company, provide.

Having both a business entity and a federal identification number will help ensure that your personal assets won’t be up for grabs if someone tries to sue you.

How do I get an EIN if I don’t have a social security number?

You’ll need to apply by mail using Form SS-4 to obtain your EIN.

How do I report EIN identity theft?

If you suspect your EIN has been used to file fraudulent tax forms or returns, complete Form 14039-B: Business Identity Theft Affidavit. Submit it to the IRS by mail or fax by following the instructions on the form. You can also visit an IRS Taxpayer Assistance Center to deliver the form in person. Still, you must schedule an appointment by calling the toll-free number on the form.

Make Your Small Business or Side Hustle Official Today

An Employer Identification Number creates opportunities for additional funding and helps you scale your business. Take the time to square away this administrative step now to ensure your entrepreneurial efforts have the support they need.

Best pricing for simple filings
ZenBusiness
From $0, plus government filing fees
Jump to details
Good for Speedy Checkout
Swyft Filings
From $49, plus government filing fees
Jump to details
Best for business and personal filings in one place
LegalZoom
From $79, plus government filing fees
Jump to details
Best for step-by-step guidance
Northwest Registered Agent
From $100, plus government filing fees
Jump to details
Best pricing for simple filings
ZenBusiness
ZenBusiness
Best pricing for simple filings
ZenBusiness
Learn More externa link icon
  • Price:
    From $0, plus government filing fees
  • Additional help available:
    Yes
  • State-specific checkout:
    Yes
Overview:

When you’ve helped launch over 300,000 businesses, you know you’re doing something right.

ZenBusiness is a Public Benefit Corporation (PBC), a type of corporation that generates services that contribute to the public good, and agrees to operate sustainably and responsibly. The Austin-based company is also a unicorn, last valued at $1.7 billion in November 2021. ZenBusiness’ website includes recommended resources for women and BIPOC business owners, along with clear statements on diversity, equity, and inclusion. ZenBusiness also has an “excellent” rating on TrustPilot, based on the average of the over 10,000 reviews it has received from customers.

Most notably, however, the company’s Starter package will let you file the essentials for free, plus the cost of state filing fees.

Starter package

  • Standard filing service: ZenBusiness team will file and return your completed documents with the state.
  • Standard filing speed: ZenBusiness will process and return the completed state documents, based on when the order is received, as well as the backlog the state is working through at that time. This can range from a few days to a few weeks, depending on the state.
  • Expense and deduction tracking: Each Starter package includes a free Money Essential tool that allows customers to easily track expenses and tax deductions for improved accounting and easier tax return preparation.
Good for Speedy Checkout
Swyft Filings
Swyft Filings
Good for Speedy Checkout
Swyft Filings
Learn More externa link icon
  • Price:
    From $49, plus government filing fees
  • Additional help available:
    Yes
  • State-specific checkout:
    Yes
Overview:

Swyft Filings has helped over 250,000 business owners in all 50 states with filings since its inception in 2015. Founded by a lawyer, the company’s services assist with LLC formation, DBAs, registered agents, and S corporation elections. They also work with new and established nonprofits. Continued support or professional guidance is available after you file if you want a helping hand.

The company is focused on business filings only, and does not offer personal legal counseling. Swyft Filings has a 4.8/5 rating from over 5,300 reviews on Trustpilot, a reviews aggregator service. The company has formation-specific FAQ sections, live chat, and a toll-free phone number you can call if you want to speak to someone personally. As its name suggests, Swyft Filings’ website is lightning fast and easy to navigate.

Best for business and personal filings in one place
LegalZoom
LegalZoom
Best for business and personal filings in one place
LegalZoom
Learn More externa link icon
  • Price:
    From $79, plus government filing fees
  • Additional help available:
    Yes
  • State-specific checkout:
    Yes
Overview:

LegalZoom helps you set up an LLC in your state quickly, easily, and entirely online. An LLC is needed for important business functions, such as opening a business bank account. Different states have different business formation requirements; LegalZoom customizes the process for you based on what state you live in, and the company helped consumers form 447,000 businesses in 2021, according to a press release.

Mistakes can be made when trying to form an LLC by yourself, and business formation professionals can be expensive. If you want a cost-effective and convenient way to create your LLC (and keep more of the money you make from your side hustle or business when tax time rolls around), LegalZoom is a great option.

Best for step-by-step guidance
Northwest Registered Agent
Northwest Registered Agent
Best for step-by-step guidance
Northwest Registered Agent
Learn More externa link icon
  • Price:
    From $100, plus government filing fees
  • Additional help available:
    Yes
  • State-specific checkout:
    Yes
Overview:

Northwest Registered Agent became popular for its $39 LLC formation service, which it offered in its early years. It’s also well known for its commitment to customer service; the company’s tagline is “We’re just not annoying”, and the website manifesto outlines the family-owned business’ commitment to communication and transparency. Northwest Registered Agent’s website makes checkout very simple, and it automatically directs you to state-specific filing details, making it easy to customize your order.

A handy feature of Northwest Registered Agent’s checkout process is that you don’t totally need to know everything you might need or want from a filings perspective when you sign up. The guided checkout process explains filings as you go, allowing you to customize your order and ensure you’ve set yourself up for success.