A federal tax ID quantity, also called an Employer Identification Quantity (EIN), is a novel nine-digit quantity assigned by the Inside Income Service (IRS) to companies and different authorized entities. It’s much like a Social Safety quantity for people, and is used to establish taxpayers for the needs of taxation and reporting.
Acquiring an EIN is essential for companies and organizations, because it allows them to open enterprise financial institution accounts, file taxes, and rent staff. The introduction of the EIN in 1954 streamlined the tax system and improved compliance, making it a vital software for companies and the IRS alike.