When an Independent Contractor Does Not Need an EIN
Most independent contractors are not required to have an EIN if:
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They operate as a sole proprietor
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They have no employees
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They do not file certain excise or pension plan returns
In these cases, the contractor can simply use their Social Security Number (SSN) for tax purposes.
When an Independent Contractor Must Get an EIN
You must obtain an EIN if any of the following apply:
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You hire employees
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You choose to operate as an LLC, partnership, or corporation
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You need to file excise tax returns
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You have a Keogh/solo 401(k) retirement plan
Reasons Many Independent Contractors Choose to Get an EIN Anyway
Even if it's not required, many contractors voluntarily get an EIN because it can:
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Protect your SSN by not sharing it with clients or on W-9 forms
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Make your business appear more professional and established
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Simplify business banking (many banks require an EIN to open a business account)
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Prepare you for future growth (e.g., if you hire workers later)
Independent contractors do not always need an EIN, but getting one is free, takes minutes, and can provide privacy, professionalism, and flexibility as the business grows.