Running a business means meeting a lot of government requirements and following a number of laws. One of the first things to do when starting your business is apply for an FEIN. But, what is an FEIN? And, do you have to have one? Keep reading to learn the answers to these questions and more.

FEIN Definition

So, what is the FEIN meaning? FEIN stands for Federal Employer Identification Number. It’s also known as an EIN, an Employer Identification Number, or a business tax ID. The IRS issues FEINs to businesses for tax purposes. An FEIN is different from an employer state ID number. 

The FEIN the IRS assigns to your business is your permanent tax ID number until you change your business entity or close your account.

An FEIN is a type of taxpayer identification number (TIN) most (but not all!) businesses use. Other examples of taxpayer identification numbers include Social Security Numbers (SSNs) and Individual Taxpayer Identification Numbers (ITINs).

The FEIN number is a unique, nine-digit number that identifies businesses operating in the United States. The IRS structures the federal tax identification number in an XX-XXXXXXX format.

What exactly is the FEIN used for?

When you file documents like Form W-2, Form 941, and business tax returns, you must identify your business. These forms prompt you for your EIN. Keep your business ID number in a safe location so you can easily access it and record it on your tax forms.

Who needs an FEIN?

Now that you know what a federal EIN is, you might be unsure whether or not it applies to you. So, who needs a business tax ID? You must have a federal tax ID number if you have employees.

The IRS also requires you to have an FEIN if you:

• Structure your business as a corporation or partnership 
• File certain tax returns (e.g., employment or excise tax)
• Withhold taxes on income, other than wages, for non-resident aliens
• Have a Keogh plan

You may also need an FEIN if you are involved with certain types of organizations, including:

• Trusts, except certain grantor-owned revocable trusts, IRAs, and Exempt Organization Business Income Tax Returns
• Estates
• Real estate mortgage investment conduits
• Non-profit organizations
• Farmers’ cooperatives
• Plan administrators

If you have more than one business that meets the requirements for an FEIN, you must apply for additional EIN numbers. 

Visit the IRS’s website to determine if you need an FEIN.

How to apply for FEIN

Now that you know what an FEIN is and what to use it for, let’s look at how to get a business EIN. Keep in mind that you get a free EIN number when you apply. There are no fees to apply for an FEIN. 

Already have an FEIN but lost it? Do not apply for another FEIN if you lost your Federal Employer Identification Number. Instead, try to locate your lost or misplaced EIN. You can search for your computer-generated notice, look for documents containing the number, or call the IRS EIN phone number to retrieve it.

FEIN application process

There are a few ways you can apply for an EIN number from the IRS, including: 

• Online
• Fax
• Mail

Online

You can apply online for your FEIN with a valid Taxpayer Identification Number (e.g., Social Security number). The online system requires you to complete your application in one session. Keep in mind that sessions expire after 15 minutes of inactivity, so be sure to have all necessary documentation ready before you begin. 

After you complete your online application, the IRS immediately gives you your federal identification number. Download, save, and print your new FEIN. Keep your tax number in a safe spot so you do not misplace it. 

Fax

Prefer completing a physical application? Fill out IRS Form SS-4, Application for Employer Identification Number. Your business location determines the number you fax your application to:

• Use (855) 641-6935 if your principal business, office or agency, or legal residence is located in one of the 50 states or D.C.
• Fax the form to (855) 215-1627 if you have no legal residence, principal place of business, or principal office or agency in any state
  • If you are outside the U.S., fax the application to (304) 707-9471

The IRS sends your EIN within four business days via fax if you provide a return fax number. If you do not provide a return fax number, the return process may take up to four weeks. 

Mail

If you do not have a fax machine or do not want to apply online, you can send your FEIN application in the mail. Like with faxing, you must complete a physical copy of Form SS-4 and send it to the IRS. 

If your business location is in one of the 50 states or D.C., mail Form SS-4 to:

Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999

If you have no legal residence, principal place of business, or principal office or agency in any state, mail Form SS-4 to:

Internal Revenue Service
Attn: EIN International Operation
Cincinnati, OH 45999

According to the IRS, processing can take up to four weeks for applications sent via mail. If you need an EIN quickly, this might not be the best method to use. 

Have your FEIN? Great! Now what? Download “Your Guide to Employment Forms” to learn what types of documents you need to file (and include that FEIN on!).

Canceling your FEIN

After the IRS creates an FEIN for you, the IRS never uses that number for another business. And, you cannot cancel your FEIN. But, you can close your business account with the IRS. Keep in mind that canceling your business account does not remove your FEIN from the IRS’s database. 

To close your business account, include your business’s legal name, FEIN, business address, and reason for closing your account. If you still have it, include the copy of the EIN Assignment Notice from the IRS.

You can mail all the materials to:

Internal Revenue Service
Cincinnati, OH 45999

The IRS only cancels a business account if you have filed all necessary tax returns. You need to file returns if you:

• Made a federal tax deposit or other federal payment
• Are liable for business tax returns
• Received an IRS notice that your business tax return is due

Do you have employees and want to simplify the payroll process? Patriot’s online payroll software is a simple three-step process: Enter hours, approve payroll, and pay your employees. And with our Full Service payroll option, we’ll deposit and file your taxes on your behalf so you save even more time. Get your free 30-day trial today!

This article has been updated from its original publication date of November 1, 2014.

This is not intended as legal advice; for more information, please click here.