Using an EIN to File Business Income Taxes

Oct. 14, 2025, 6:01 p.m.
Using an EIN to File Business Income Taxes An Employer Identification Number (EIN) is more than just a business ID — it’s a crucial tool for handling your federal and state income tax filings in the United States. Whether you run a one-person LLC, a partnership, or a corporation, your EIN acts as your company’s official taxpayer number when dealing with the IRS and other agencies.
EIN to File Business Income

What Is an EIN?

An EIN (Employer Identification Number) is a nine-digit number issued by the Internal Revenue Service (IRS). It uniquely identifies your business for tax purposes — much like how a Social Security Number (SSN) identifies individuals.

You’ll need an EIN for most formal business and tax activities, including:

  • Filing business income tax returns

  • Reporting and paying payroll taxes

  • Opening business bank accounts

  • Applying for business credit or licenses

Who Needs an EIN to File Business Taxes?

Not every business is required to have an EIN — but most do. You generally need an EIN if your business:

  • Has employees

  • Operates as a corporation or partnership

  • Files excise, alcohol, tobacco, or firearms tax returns

  • Has a Keogh plan (self-employed retirement plan)

  • Withholds taxes on income paid to a non-resident alien

Even single-member LLCs and sole proprietors often use an EIN for filing, especially if they prefer not to use their SSN.

 

 How EINs Work in Tax Filing

When you file your business tax return, the EIN is the number the IRS uses to track all income, deductions, and tax obligations related to your business.

Here’s how it applies to different business types:

Business Type IRS Form EIN Requirement
Sole Proprietor Form 1040 + Schedule C Optional (EIN or SSN)
Single-Member LLC Form 1040 + Schedule C (or Form 1120S if electing S-Corp) Recommended
Partnership Form 1065 Required
Corporation (C-Corp) Form 1120 Required
S-Corporation Form 1120-S Required
Nonprofit Organization Form 990 Required

 

 State Taxes and EIN

Most states use your federal EIN as the reference number for state-level income, payroll, or sales tax accounts. After obtaining your EIN, you’ll typically register it with your state’s Department of Revenue to file local taxes or apply for tax permits.

Filing Steps Using Your EIN

  1. Get your EIN from the IRS (online via irs.gov).

  2. Register your business with your state tax agency.

  3. File the correct federal return for your entity type (Form 1040 + Schedule C, 1065, 1120, or 1120S).

  4. Report your EIN on all tax filings and correspondence.

  5. Pay estimated taxes quarterly, if required.

  6. Keep records of income, expenses, and EIN-related communications for at least 3–7 years.

 Common EIN Tax Filing Mistakes

  • Using an individual SSN instead of EIN for business returns

  • Forgetting to include the EIN on tax forms or W-2/W-9 filings

  • Using the wrong EIN after ownership or structure changes

  • Filing under a revoked or inactive EIN

  • Mixing personal and business income under one taxpayer ID

Key Takeaway

Your EIN is the foundation of your business tax identity. It ensures proper separation between your personal and business finances, simplifies compliance, and makes it easier to manage taxes at both federal and state levels.

If your business earns any form of income in the U.S., having and properly using an EIN for filing protects you from legal issues and keeps your tax records clean.