If you own a business in the United States, you know how important it is to have an Employer Identification Number (EIN). An EIN is a nine-digit number that identifies your business as a separate legal entity from its owners. It’s essential for opening a bank account, filing taxes, and applying for credit.
But what if you’re not sure about the legitimacy of an EIN? Maybe you received one from a friend or family member who promised to help you with your business formation. Or maybe you found an EIN online that looks suspicious. Whatever the reason, you need to know how to verify a company’s EIN.
What is an Employer Identification Number (EIN)?
An Employer Identification Number (EIN) is a nine-digit number that identifies your business as a separate legal entity from its owners. It’s essential for opening a bank account, filing taxes, and applying for credit.
When you apply for an EIN, the IRS will assign you a unique number based on your business structure, location, and other factors. The IRS uses this number to track your business’s tax obligations and other financial activities.
Verifying an EIN: Why it Matters
Verifying an EIN is crucial for any business that wants to operate legally in the United States. Here are some reasons why:
- Avoid Fraud: Scammers can use fake EINs to open bank accounts, file taxes, and apply for credit in someone else’s name. By verifying an EIN, you can ensure that it belongs to your business and not a fraudulent entity.
- Ensure Compliance: Verifying an EIN is the first step towards ensuring compliance with federal and state regulations. Without an EIN, your business will be ineligible for many tax deductions, licenses, and permits.
- Protect Your Business: If your business has been issued an EIN but you’re not sure of its legitimacy, it could put your business at risk of legal action or fines. By verifying an EIN, you can protect your business from fraudulent activities.
How to Verify an EIN
Verifying an EIN is a simple process that involves contacting the IRS. Here’s how:
- Go to the IRS website: Visit the IRS website and navigate to the “Tools” section. Look for the “Business Entity Identification and Taxpayer Requests” link and click on it.
- Select the Type of Request: Choose the type of request that you need, such as verifying an EIN or obtaining a new one. Follow the prompts to provide your business information and enter the EIN in question.
- Submit Your Request: Once you’ve provided all the necessary information, submit your request. The IRS will verify the EIN and send you a confirmation email or letter within 7-10 business days.
- Check for Updates: If you don’t receive a confirmation email or letter within 7-10 business days, check the IRS website to see if there are any updates on your request. You can also contact the IRS Business and Specialty Tax Line at 800-829-4933 for assistance.
Common Mistakes to Avoid When Verifying an EIN
Here are some common mistakes people make when verifying an EIN:
- Not Providing Accurate Information: Make sure you provide accurate and up-to-date information about your business, including its legal name, tax
