IRS Form SS-4: Why It’s Important for Your Small Business
Let’s get straight to the point. What is an SS-4 form?
An SS-4 form is the Internal Revenue Service application for an Employee Identification Number (EIN), a nine-digit number that enables you to create a business tax account. After you fill out and submit the form, you will receive a notice confirming the newly issued EIN number for your business.
What is an EIN? It’s like a Social Security number for a business, Carl Brown, state and executive director of the District of Columbia Small Business Development Center, said.
In addition to needing the number itself, you will likely need the Form SS-4 notice — also called Form CP-575 — that verifies this number belongs to you. This notice can be as important to your business as a driver’s license or passport is for personal purposes.
Without a driver’s license or passport you won’t be able to open a checking account or apply for a small business loan. Similarly, without your Form SS-4 notice, you might not be able to apply for a business account or loan, even if you have your actual EIN. In a nutshell, the notice serves as proof that this EIN is, in fact, yours.
Are your brain cells twisted in knots yet?
Keep reading to learn more about the Form SS-4 and the SS-4 notice (and how to use them), plus how to apply for an EIN and what it all means for your business.
What is Form SS-4
The Form SS-4 notice, aka the CP-575 notice, is the letter that verifies your EIN, which is also called your business tax ID number. If you are an entrepreneur who wears many hats, pay close attention to this document because it’s a single letter you can easily misplace.
So to quickly review, the SS-4 form is the application itself. Complete this form to get an EIN number, which establishes a separate business tax account. When you complete and submit the application you will get an EIN assigned to your business. Next, you’ll receive the CP-575 notice, which verifies the EIN you were issued.
When you need a Form SS-4
Business entities, such as corporations and partnerships, need to complete the Form SS-4 form.
“If you want to have a corporate designation, you have to get an EIN number to track any funds that are coming into your business under that number, as opposed to your Social Security number,” Brown said.
Other entities that must complete the Form SS-4 include trusts, estates, real estate mortgage investment conduits (REMICs), nonprofit organizations, farmers’ cooperatives and plan administrators. Exceptions include IRAs, business income returns from exempt organizations and particular grantor-owned, revocable trusts.
A business also needs to complete a Form SS-4 to get an EIN if it has employees, withholds taxes on income other than wages paid to a nonresident alien, or has a qualified retirement plan. In addition, if you are required to file for employment tax, excise tax, or alcohol, tobacco and firearms tax, your business must have an EIN.
You might be required to use the same EIN when applying for loans and opening a business account.
“If you’re a corporation and going to open up a business bank account, they want that number [an EIN], not your Social Security number, not unless you’re a sole proprietor,” Brown said.
Also, you’ll need an EIN to apply for government contracts and to register for a DUNS number, which is an identification number for businesses that apply for government contracts through the System for Award Management database. The SAM database stores contractor information so government agencies can search for businesses with which to work.
“If you don’t have an EIN number, you’re not going to be able to register in SAM. If you’re doing any business with the federal government, before you can be awarded a contract, you have to register at SAM.gov,” Brown said.
If you’re a sole proprietor
If you’re a sole proprietor, you don’t need an EIN number. A sole proprietor runs an unincorporated business, according to the IRS, and there is no distinction between a sole proprietor and his or her business. A sole proprietor can use a Social Security number to file taxes — and also get an EIN. If a sole proprietor plans on hiring an employee or establishing their business as a partnership or corporation, they will need to get an EIN.
How to get a copy of your Form SS-4 notice
If you have lost or misplaced your EIN or your Form SS-4 notice, here are four ways to relocate it:
- Review your inbox backlog for the SS-4 notice (aka the Form CP-575), which you receive to verify your EIN after you’ve submitted the SS-4 form. The CP-575 form will have your EIN listed.
- If you opened a bank account, or registered for a state or local license, ask the bank or issuing agency for this information.
- Find a copy of a tax return from a previous year — the EIN will be noted.
- Call the Business and Specialty Tax Line at 800-829-4933 between 7 a.m. and
7 p.m. local time, Monday through Friday. A representative will ask for identifying information and then give you the number.
Applying for an EIN number through the SS-4 Form
Here is how to apply for an EIN. Make sure you use only one method to avoid being issued two EINs.
Online: You will need a U.S.-based office or agency, legal residence or principal place of business in the U.S. or U.S. possessions. Register at IRS.gov/businesses. You will have the option to print the assignment notice at the end of the application. The principal, owner, grantor, etc. will need to have a Taxpayer Identification Number, such as an EIN, SSN or ITIN. If the applicant has no principal office or legal residence in the U.S., or any U.S. possessions, he or she cannot apply online and will have to use another option to secure an EIN.
Phone: The phone application is available only for international applicants. The IRS encourages applicants to complete an application before contacting it to simplify the process. Application via phone is for applicants with no principal office or legal residence in the U.S. or U.S. possessions. Call 267-951-1099 (not toll-free) from 6 a.m.
to 11 p.m. EST, Monday through Friday. Before you call, make sure you are authorized to receive the EIN and answer questions. Fill out the Third Party Designee section if you want the individual listed to have authorization to obtain the EIN and answer questions about it.
Apply by mail: Print the online SS-4 Form, fill it out and submit it. Leave a four- to five-week window to receive your number tin the mail. Call 800-829-4933 to check on the status of your mailed application.
Fax: The Fax-TIN program takes approximately four business days to issue an EIN. Submit Form SS-4 to the number listed in “Where To File or Fax.” If you are outside the local jurisdiction of the call area a fee will apply. The program is available 24/7 — make sure you include your fax number so you can receive your EIN via fax.
The bottom line
If you’re a business owner, getting an EIN by filing the Form SS-4 form will help you get your business on solid financial footing. Apply for an EIN today to avoid any issues. If you already have one, locate the confirmation notice (Form CP-575) and keep it in a secure place where you can easily access it when you need it.