No one ever said that starting a business would be easy. The rewards can be plentiful, but you have to put in a lot of blood, sweat, and tears to be successful.
Not only that, but there are also many tax obligations to fulfill, and sifting through forms is never fun. When you consider things like TIN vs EIN vs SSN vs ITIN, your head may be swimming in that alphabet soup.
What are these terms, who needs these things, and how can you get them? This article will give you an in-depth guide so you’ll feel confident tackling paperwork.
What Is a TIN?
“TIN” stands for “Taxpayer Identification Number.” It’s a general term that refers to any number used by the IRS to identify a certain taxpayer. This means that anyone who files taxes with the IRS will need a TIN.
Both individuals and businesses can have a TIN. This umbrella term includes:
- SSNs
- EINs
- ITINs
To get a TIN, it’ll depend on the specific one. You can explore the other acronyms below.
What Is an EIN?
An EIN is an Employer Identification Number, which is nine digits long. It’s used by the IRS to identify businesses for tax purposes. In some cases, it’s also referred to as a Federal Tax ID (FTID) or Federal Employer Identification Number (FEIN).
This means that in the question of FEIN vs TIN, a FEIN (or EIN) is a specific type of TIN. If you’re asking, “Is a tax ID the same as an EIN,” then the answer is “not quite.” EINs are a type of tax ID (or TIN), but not all tax IDs are EINs.
Your EIN is used for filing company taxes, opening business bank accounts, and payroll. However, it’s not tied to your own credit.
Once you apply for an EIN, it never expires. This means you don’t have to renew it either.
Who Needs an EIN?
Businesses with employees will need an EIN. You’ll also need it if you fall under this list:
- Partnerships
- Corporations
- Nonprofit organizations
- Trusts and estates
- Sole proprietors (optional unless they have employees)
So is your EIN your tax ID? It is if you’re in the above categories.
How to Get an EIN
We have a thorough guide on how to get an EIN for your LLC. However, here are the options available:
- Apply online on the IRS website (if you have an SSN or ITIN)
- Complete Form SS-4 and submit it by mail or fax (if you don’t have an SSN or ITIN)
- Call the IRS if you’re an international applicant
It’s free to get an EIN, but you must provide the legal name and TIN of one of the following:
- Owner
- True principal officer
- General partner
- Grantor
- Trustor
What Is an SSN?
“SSN” is short for “Social Security Number” and it’s also a nine-digit number. However, instead of it being for businesses, it’s for US citizens and is issued by the Social Security Administration (SSA).
An SSN is used as a personal identifier, and it’s usually used for financial, tax, and employment purposes. Most importantly, the work data retained is used by the government to determine how much Social Security benefits a person gets.
Because of the SSN’s widespread application, it’s often misused in identity theft. So keep this number as safe and protected as possible.
An SSN is free to request from the SSA.
Who Needs an SSN?
All US citizens and lawful permanent residents need SSNs. Those who are working in the country or are applying for Social Security benefits need SSNs too. Workers must use their SSNs to report wages.
If you’re a business owner, you can use it to open bank accounts (both personal and business ones). You can also use it to file annual tax returns and apply for federal loans.
How to Get an SSN
US citizens can submit Form SS-5 to the SSA by going to a local office. Include proof of identity and citizenship.
For noncitizens, they must have work authorization or qualify under specific visa categories. They must also apply in their home country at a Social Security Field Office.
What Is an ITIN?
“ITIN” is short for “Individual Taxpayer Identification Number.” It’s a nine-digit number that starts with a 9 and is issued by the IRS too.
ITINs are used by people who need to file taxes but aren’t eligible for SSNs. Do note that they’re only for tax reporting, and don’t authorize work or provide Social Security benefits.
If you haven’t used your ITIN in the past three consecutive years, you must renew it.
Who Needs an ITIN?
Nonresident aliens who have US income will need ITINs. If you’re a resident alien who has to file a US tax return, you’ll also need a TIN.
The loved ones of individuals who fall into the above categories need their own ITINs too; more specifically, their dependents or spouses.
Non-residents who have US-sourced income and owe taxes to the IRS must also get an ITIN.
How to Get an ITIN
To get an ITIN, first complete Form W-7. Submit it to the IRS with your proof of identity and foreign status. Alternatives for submission include:
- Through an IRS Acceptance Agent
- By mail
- In person at IRS Taxpayer Assistance Centers
TIN vs EIN vs SSN vs ITIN: Know the Differences
When looking at TIN vs EIN vs SSN vs ITIN, it’s simple: “TIN” is an all-encompassing term that includes EINs, SSNs, and ITINs. Then, you can split it up into two categories: businesses (EINs) and individuals (SSNs and ITINs).
By knowing the differences between all these terms, you’ll know which you should have. This will make applications easier, faster, and less confusing.
If you’re ever unsure about which you need, then speak to a tax professional. They’ll be able to assess your situation and point you in the right direction.
Need to form an LLC? Then sign up with Business Anywhere now to use our free business registration service.
