If you’re starting a business in the United States, one of the very first steps you’ll encounter is obtaining an EIN. But what exactly is an EIN, who needs it, and how do you get one—especially if you live outside the U.S.?

In this guide, we break down everything you need to know about the EIN with simple, expert clarity so you can start and run your U.S. business with confidence.

What Is an EIN?

EIN stands for Employer Identification Number.
It is a unique federal tax ID issued by the IRS to identify a business for tax purposes.

Think of it as the Social Security Number (SSN) for your company.

The IRS uses the EIN to track:

• Federal tax filings

• Payroll and employment taxes

• Banking

• Business income

• Compliance

Whether you are forming an LLC, Corporation, Partnership, or Trust, the EIN becomes the official identity of your business.

Who Needs an EIN?

Almost every business needs an EIN.
You must obtain an EIN if:

• You are forming an LLC

• You are forming a Corporation (C Corp or S Corp)

• You have more than one owner

• You plan to hire employees

• You need a business bank account

• You are an Amazon, Shopify, or e-commerce seller

• You are a foreign owner starting a U.S. company

• You want to build business credit

• You receive 1099 or W-9 requests from clients

If you’re serious about running a legal, compliant business, you need an EIN.

Why Is an EIN Important? Key Benefits

⭐ 1. Open a U.S. Business Bank Account

Banks require an EIN to verify your business.
Without it, you cannot open a proper business account.

⭐ 2. File Federal and State Taxes

Your EIN is required for all business tax filings, including:

• Federal income tax return

• Payroll taxes

• Excise taxes

• Franchise taxes

⭐ 3. Hire Employees

If you plan to hire workers or contractors, the IRS requires an EIN.

⭐ 4. Work With Payment Processors

Stripe, PayPal, Shopify Payments, Amazon, eBay, and others require an EIN for verification.

⭐ 5. Separate Personal & Business Liability

An EIN helps create a clear separation between your finances and the business.

⭐ 6. Build Business Credit

Vendors, suppliers, and lenders often ask for your EIN.

Do Non-U.S. Citizens Need an EIN?

Yes — foreign entrepreneurs can obtain an EIN even without a Social Security Number (SSN).

This is where things can get tricky because:

• The IRS rejection rate is high for incorrect forms

• One simple mistake delays your entire business setup

• Non-U.S. owners must follow a different application process

Good news: With proper documentation, foreign owners can successfully obtain an EIN.

How Long Does It Take to Get an EIN?

Time depends on your situation:

✔ If the owner has an SSN or ITIN:

Same day to 1–3 business days

✔ If the owner is foreign and has no SSN or ITIN:

7–14 business days
(when prepared correctly)

How to Apply for an EIN (Step-by-Step)

The EIN is issued by the IRS through Form SS-4.
Here’s a simple breakdown:

1. Prepare the Required Information

• Business name

• Responsible person

• Mailing address

• Entity type

• Ownership details

• Business purpose

2. Submit Form SS-4 to the IRS

This can be done by phone (for foreign applicants), fax, or a tax expert on your behalf.

3. Receive Your EIN Confirmation Letter (CP 575)

This letter is the official proof of your EIN.
Banks and payment processors require it.

Important: Many banks will NOT accept a fax confirmation.
They want the official CP 575 letter—TAM Accounting provides this correctly.

Common EIN Mistakes New Business Owners Make

Avoid these to save time and avoid IRS delays:

❌ Incorrect responsible party
❌ Wrong entity type selected
❌ Wrong address format (especially for foreign owners)
❌ Filing before registering the LLC/Corporation
❌ Using the wrong “reason for applying”
❌ Missing signatures or incomplete fields

One mistake can delay your EIN for weeks.

Do You Need an EIN or ITIN? (They’re Different)

Many people confuse these two:

EIN

→ For the business
→ Needed for tax filing, banking, payments, hiring

ITIN

→ For the individual
→ Used for personal tax returns, not business registration

Foreign entrepreneurs often need both.

How Much Does an EIN Cost?

The IRS does not charge a fee.

However, most entrepreneurs — especially international founders — use a professional service to avoid delays, rejections, and wrong documentation.

Professional EIN assistance ensures:

• Correct IRS formatting

• Fast processing

• No delays

• Bank-ready documentation

• Proper U.S. compliance setup

Final Thoughts: Your EIN Is the Foundation of Your U.S. Business

Whether you’re starting an LLC, Corporation, e-commerce store, or a consulting business, the EIN is the key that unlocks:

• Banking

• Taxes

• Compliance

• Payments

• Hiring

• Growth

Get it done right the first time—and avoid the delays that slow most entrepreneurs down.

🚀 Need an EIN Fast and Done Correctly?

At TAM Mentor & TAM Accounting, we obtain EINs for:

• U.S. owners

• Foreign founders

• LLCs

• C Corporations

• Trusts

• Partnerships

We ensure full IRS compliance, provide the official CP 575 letter, and guide you through banking and next steps.

Start your EIN process today and launch your U.S. business the right way.