An Employer Identification Number (EIN) (also called Federal Employer Identification Number, or FEIN) is a taxpayer number issued by the Internal Revenue Service (IRS). It is similar to a Social Security number but is used for a business. Most businesses will need a FEIN.

Your business will need a FEIN from the IRS if you:  

• Hire or will hire employees, including household employees, 
• Run a business as a corporation or partnership,
• File any of these tax returns:
  • employment,
  • excise, or
  • alcohol, tobacco, and firearms,
• Withhold taxes on income, other than wages, paid to a non-resident alien,
• Offer a tax-deferred pension plan, known as a Keogh plan,
• Work with trusts, estates, non-profit organizations, and certain other types of organizations, or 
• Change the legal character or ownership of your business (for example, you incorporate a sole proprietorship or form a partnership).

Getting a FEIN can be helpful in other ways, too. For example:

• Many banks require a FEIN to open a bank account or receive a loan; and
• Many states require a FEIN if you need to get a license to operate your business.  

It is free to apply for a FEIN, and it is best to apply right after you create your business. If you are a sole proprietorship or single-member LLC and do not plan on hiring any employees, you may not need a FEIN. However, it is generally a good idea to apply for one anyway. 

In addition to a FEIN, Illinois businesses are required to obtain an Illinois Department of Revenue (IDOR) Account ID number. This process can be completed online through the Illinois Department of Revenue website.

Learn more about getting an ID number for your new business.