ITIN vs EIN: which tax ID a person or a business needs

A TIN is the family name. A Social Security number, an EIN, an ITIN, an ATIN, and a PTIN are all TINs. The ITIN and the EIN are the two people mix up, because both come from the IRS and neither is a Social Security number.

If you are choosing between an ITIN and a Social Security number for yourself, start with ITIN number vs SSN. This page is about the business number.

How the personal application works is in how to get an ITIN.

You need an EIN if you have employees, if you withhold tax on income other than wages paid to a nonresident alien, or if you pay employment, excise, or alcohol, tobacco, and firearms taxes. You also need an EIN to operate a partnership, an LLC, a corporation, a tax-exempt organization, an estate, or a trust, among the entities the IRS lists.

You can still request an EIN for a bank account or for state tax even when federal tax rules don't force one. The IRS says an EIN is not for unrelated uses such as a state tax-lien auction.

The online tool is free and, if the IRS approves the application, it issues the EIN immediately. Finish it in one session. You can apply for only 1 EIN per responsible party per day. A faxed Form SS-4 comes back in about 4 business days if you include a return fax number. A mailed Form SS-4 takes about 4 weeks. You can use a new EIN right away to open a bank account. Wait up to 2 weeks before you e-file a return or pay tax electronically.

Beware of sites that charge for an EIN. The IRS issues it for free.

No. A business cannot have an ITIN. An ITIN is issued only to an individual. An LLC does not have an ITIN either. If the LLC needs a federal tax ID of its own, that ID is an EIN.

• Can a business have an ITIN? No. Ask for an EIN when the IRS says the entity needs one.
• Do LLCs have an ITIN? No. A domestic LLC with 2 or more members is a partnership for federal income tax unless it elects to be taxed as a corporation, and it needs an EIN.
• Does a single-member LLC need an EIN? For income tax, a disregarded single-member LLC with no employees and no excise tax does not. It uses the owner's SSN or EIN. It can still get an EIN for a bank account or because the state requires one. Most new disregarded single-member LLCs will need an EIN. Employment tax always uses the LLC's own EIN.
• Do you need an ITIN for your business? You need one for yourself if you must file a personal US return and you can't get an SSN. The LLC's number is still the EIN. You also need an SSN or ITIN if you want to apply for that EIN online.
• Is an EIN better than an SSN? They are not substitutes. Your personal return uses your SSN or ITIN. The business uses its EIN when the IRS requires one, including for employees.

A disregarded single-member LLC owned by an individual reports the activity on the owner's Form 1040 or 1040-SR, usually on Schedule C, E, or F. The owner who can't get an SSN uses an ITIN on that personal return. The W-9 for a disregarded LLC generally shows the owner's SSN or EIN, not a separate ITIN belonging to the company.

Personal bank accounts that accept an ITIN are covered in opening a US bank account. For the company, banks ask for the EIN.

1. 1

   Decide which ID is missing

   If you personally can't get an SSN and you have a federal tax reason, you need an ITIN. If the company needs to hire, open an entity account, or file entity taxes, you need an EIN. Many foreign owners need both, for different reasons.

2. 2

   Get the EIN even if the ITIN is still pending

   International applicants, and responsible parties with no SSN or ITIN, apply for the EIN by phone at 267-941-1099, or by fax or mail. You do not have to wait for the ITIN to give the business its EIN.

3. 3

   Get the ITIN when a personal return needs it

   File Form W-7 with the return, or with the proof of an exception. Allow 7 weeks for the IRS notice, or 9 to 11 weeks from January 15 through April 30 or from abroad. The steps are in how to get an ITIN.