Did you know that your non-profit organization may still need a Tax ID number? Even if your non-profit organization is tax exempt, a Tax ID number is used for more than just paying taxes. Here’s what you need to know about why you may need an EIN Number and how you can acquire one.
Steps to Getting a Tax ID (EIN) Number for a Non-Profit Organization
- Prepare Mandatory Business Information
- Apply for a Non-Profit Organization Tax ID (EIN) Number Online
- Apply for a Non-Profit Organization Tax ID (EIN) Number via Mail or Fax
- How Do I Obtain a Tax ID (EIN) Number for my Non-Profit Organization?
- How Long Does it Take to Obtain a Tax ID (EIN) Number for my Non-Profit Organization?
- Why Do I Need a Tax ID (EIN) Number for my Non-Profit Organization?
Here’s your first step: it’s time to prepare your mandatory business information. For a non-profit organization, you’ll need to declare: the non-profit’s name, mailing address, date of formation, and its reason for acquiring an EIN Number now.
You’ll also need to provide information for an owner or a registered agent. With a regular business, you’ll usually put an owner or a partner there. For non-profit organization, it will usually be a board member.
The registered agent is going to be the person who is contacted if there are any issues with the application. This is the person who should serve as a first point-of-contact for anything that is EIN related. If it’s a registered agent, often it will be your accountant or your bookkeeper.
Does your non-profit organization need a tax ID now? You can apply for a non-profit organization tax ID (EIN) number online to get it within an hour. To apply for a tax ID number online:
- Collect your mandatory company information.
- Get information about your board member or registered agent.
- Send the information in to a tax ID service.
- Receive your EIN Number through email.
A digital EIN Number is no different from an EIN Number received in any other fashion. In fact, this is the fastest way to get an EIN Number, and you’ll be able to use the EIN Number immediately upon receiving it.
Don’t want to apply online? You can also apply for a non-profit organization tax ID number via mail or fax. It’s the same process and the same form, the only difference is that you’ll need to print out the form and send it in.
Sending it in via mail is the slowest option. It will usually take four to six weeks to get your EIN Number back if you have the form processed via mail. Sending the form in via fax is much faster: it only takes three to five business days. Both options take much longer than applying online, which takes only an hour.
There’s no functional difference to applying for a non-profit tax ID via mail or fax, but you may experience complications and delays. If you have an error with your application online, you’ll be notified immediately. If you have an error through mail or fax, you may need to wait until the application is processed, and then correct it.
A non-profit organization can acquire a tax ID number at any time. All you need to qualify for a tax ID number is:
- Basic information about the non-profit organization, including how it is structured, when it was created, and where its official address is.
- Information about a board member or registered agent for the non-profit organization, including their SSN or ITIN.
Once you have that information, you will fill out a basic form and send it in online, through mail, or through fax.
The easiest way to obtain a tax ID number is to work with a tax ID service. A tax ID service will tell you what information you need about your non-profit, and then submit your paperwork for you. If the paperwork is submitted online, you can get your tax ID number within an hour.
How long it takes to obtain a tax ID number for a non-profit organization depends on the method used to request it. The processing time of the application itself is minimal; it’s more about the application being received.
If you apply online, you should be able to get a tax ID number within an hour. Tax ID numbers are immediately activated when they’re generated, so you’ll be able to use your tax ID number immediately.
If you apply through fax, you will be able to get your tax ID number within five business days. However, there could be delays if you don’t have a dedicated fax machine, or if you experience fax errors.
If you apply through mail, you will be able to get your tax ID number within six weeks. Mail is the slowest option for a tax ID number, and it can lead to some complications if you need a tax ID number quickly.
Overall, it’s best to apply online.
A non-profit organization is going to need a tax ID number if it wants to hire employees, acquire grants, get permits and licenses, and open small business bank accounts. Non-profit organizations still need EIN Numbers if they are going to file tax returns (even though they are tax-exempt), and will use their EIN number to identify themselves to other new businesses, non-profits, and government entities.
Permits, licenses, and employees are usually the major reasons a non-profit organization will find themselves needing an EIN. And since a non-profit organization cannot do these things without an EIN, they may find that they need their EIN quite quickly.
Though a non-profit organization may not pay taxes, they still need a tax ID number or employer identification number. If your non-profit needs an EIN, you should contact a tax ID service as soon as possible; they will be able to tell you what your next steps should be.