Does a Corporation Need a Tax ID (EIN) Number?

Nearly every business is going to need a tax ID number, otherwise known as an EIN Number. An EIN is critical for any C-Corporation that wants to hire employees, open business bank accounts, apply for business licenses, and more. A C-Corporation, as an entity, requires an EIN because it is a separate and legally distinct entity from its owners.

The only type of business that doesn’t need an EIN is generally a sole proprietorship which does not hire additional employees; they are able to use their own social security number. A corporation needs its own EIN because it will file a separate tax return, as well as hiring employees as its own entity, and maintaining things such as business bank accounts and credit cards. Acquiring an EIN is simple, and is generally done when the corporation is first formed or at any time afterwards. A corporation can acquire an EIN through fax, through the mail, or online. In general, acquiring an EIN online is the fastest way. An EIN can be acquired online within an hour using the Corporation Tax ID Number Application and the corporation can immediately begin using it.