When forming a new business entity, there are several tasks that must be performed prior to operating the ne w entity. One of those tasks is applying for and obtaining a Federal Employment Identification Number (“FEIN”) for the new business. FEINs for businesses are analogous to social security numbers for individuals. FEINs are unique nine-digit numbers used to identify business entities. Although FEINs are issued by the IRS, they are important for both state and federal purposes, and are required for state and federal filings regarding multiple issues. FEINs are required for a multitude of business purposes, such as opening a bank account for the business entity. Businesses must provide their FEINs to the bank prior to opening an account. FEINs are also used for tax purposes. When the business hires employees, its FEIN is used to track payroll taxes. The FEIN is also utilized at both a state and federal level for reporting income taxes. At the Business Law Group, we prepare and file the necessary documentation to obtain FEINs whenever we form new business entities for our clients. If you are considering forming a new business entity or have any other questions about the need for FEINs, call the Business Law Group today and speak to an attorney.
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