Overview of Foreign Employer Identification Numbers (FEIN)

5 minute read

Lloyd & Mousilli always endeavors to educate our clients on the work that is being done on their behalf. This article is intended to provide a brief overview of the Foreign Employer Identification Number (FEIN) process and some aspects to consider. An Employer Identification Number (EIN), also known as Tax ID or Taxpayer Identification Number, is a number for your business assigned by the U.S. Internal Revenue Service (IRS).

Overview

Starting a business, opening a business bank account, and filing taxes are just of few of the tasks that require setting up an Employer Identification Number (Tax ID). How do you obtan an EIN? The process is fairly straightforward if you already have a Social Security Number and can be done online through the Internal Revenue Service (IRS) website. However, if you are a foreign individual or company, the process of obtaining an EIN becomes more tedious, and specific steps must be followed.  

The Process

If you do not have a Social Security Number (SSN), the following process should be followed:

  1. Reach out to Lloyd & Mousilli to act as a Third-Party Designee for you
  2. You will need to answer some basic questions to begin the application process
  3. Lloyd & Mousilli will then prepare your Application for Employer Identification Number on your behalf, and send it out for your review and signature
  4. Lloyd & Mousilli will process your application with Internal Revenue Service (IRS) and receive your EIN on your behalf within two to four weeks.

To guarantee accurate and timely completion of the EIN application process, it is highly recommended to have a business attorney act as your Third-Party Designee to apply for your EIN on your behalf.

Frequently Asked Questions (FAQ):

What are EINs used for?

You can use your EIN to start and conduct business in United States, open up a U.S. bank account, hire employees, comply with the Internal Revenue Service (IRS), apply for permits or licenses, and file taxes.

Is an EIN the same as a Tax ID?

An EIN is a form of a Tax ID. Tax ID and EIN are sometimes used interchangeably to mean the same thing.

Is an SSN required to apply for an EIN?

No, as outlined above in “The Process” section, by reaching out Lloyd & Mousilli, to act at a Third-Party Designee, we are able to apply for the EIN on behalf of yourself or your company—even if you do not have a social security number.

Is an ITIN required to apply for an EIN?

No, you can get an EIN even if you do not have an Individual Tax Identification Number (ITIN).

Is a United States mailing address required to apply for an EIN?

No, you do not need a U.S. mailing address to apply for an EIN. You can use a non-U.S. address to apply for an EIN.

What are the other names for an EIN?

Tax ID, Employer Identification Number, Tax ID Number, Tax Identification Number, Federal Employer Identification Number, FEIN, Employer ID Number, Business TIN, Business Tax ID Number, Federal Tax ID Number, among other names.

When will I receive my EIN?

From the time the process begins by reaching out to Lloyd & Mousilli and providing basic information, to the IRS fully processing the paperwork is typically between two and four weeks.

How will I receive my EIN?

You will receive your EIN via email.

Can I use my EIN for Amazon, Kickstarter, Google Adsense, or Stripe account?

Yes, you can use your EIN to open up an account with any of the online services above.

What is an SSN?

A Social Security Number, or SSN, is a nine-digit number issued by the government for tax identification. Social security numbers are issued to people in the United States. You must be a permanent resident citizen or a temporary alien resident working in the country. If you weren’t born in the United States, you have to fill out a form to ask to be issued a social security number. This form is Form SS-5 and the United States of Citizenship and Immigration Services office reviews your application.

What is an ITIN?

An Individual Taxpayer Identification Number, or ITIN, is an identification number issued to people who are not eligible for a social security number. An ITIN allows you to file a tax return and is issued by the IRS after you fill out Form W-7. An individual taxpayer identification number is a nine-digit number used for tax purposes only.

If you need help applying for your ITIN, Lloyd & Mousilli can help with that process as well.

EIN Number Cost

The cost to get an EIN depends on your situation and can vary. Please reach out to Lloyd & Mousilli to receive an accurate cost assessment.  

Who Needs an EIN?

You may need an EIN if you have your own business. The EIN is used to identify you as a business.
If you answer yes to any of these questions, you need an EIN:

  • Do you have employees?
  • Do you operate a corporation or partnership?
  • Do you file employment, excise, alcohol, or tobacco and firearms on your tax returns?
  • Do you withhold taxes on income that’s not wages for a non-resident alien?
  • Do you have Keogh plan?
  • Are you involved with a trust, IRA, exempt organization business income tax return, estate, real estate mortgage investment conduits, non-profit organization, farmers’ cooperative, or a plan administrator?

If you’re unsure whether or not you need an EIN, contact Lloyd & Mousilli and we can help you determine the answer.

Who Doesn’t Need an EIN?

You don’t need an EIN if you don’t have a business or only have a sole proprietorship with no employees. Since an EIN is used to separate business finances from personal finances, you don’t need an EIN as a sole proprietorship because you are your business. Remember that an EIN is needed to differentiate your personal finances and those of a business. While you aren’t required to obtain an EIN as a sole proprietor in most cases, you may want to do so.

What Types of Business Entities Need an EIN?

The types of business entities that need an EIN are C Corporations, S Corporations, Multiple-Member LLCs, and Single-Member LLCs with employees. As a C or S Corporation, you are required to have an EIN. If you don’t have a social security number or an ITIN, there are still options available. Reach out to Lloyd & Mousilli to help obtain an EIN for you so you can start your corporation as soon as possible. If you’re forming a general partnership or a limited partnership, you also need an EIN. There’s no way to work around it, so scratch this major item off of your list so you can move forward in your business.

If you’re forming an LLC, you may not need to have an EIN. It all depends on whether you’re forming a multiple member LLC or if you’re going to hire employees.

If your LLC will have more than one member, you need an EIN even if you aren’t going to hire employees.

If your LLC is a single member LLC, you do not need to obtain EIN.

As long as you aren’t going to hire employees, you don’t have a Keogh plan, nor do you have a company that owes federal excise taxes – you don’t have to use an EIN.

As a sole proprietorship, your need for an EIN is the same requirements that a single member LLC follows, mentioned above.

The easiest thing to do in order to find out what you need as a new business is to contact Lloyd & Mousilli, and we will make sure your business is compliant.

 Should I obtain an EIN even if it’s not required?

There are multiple benefits to securing an EIN, even if your business doesn’t need one to operate lawfully. For example, you can’t obtain much of anything with your business name unless you have an EIN. Using an EIN also increases individual privacy and lowers the risk of theft. If you operate a sole proprietorship or single-member LLC, you’ll be able to use your EIN when you work as an independent contractor instead of your social security number. 

EIN Number Lookup

If you believe you may already have an EIN for your business but are unsure (or simply can’t remember what it is), you may call the IRS Business & Specialty Tax Line at (800) 829-4933 to find out what it is.

There are also times when knowing the EIN of your employer is beneficial. The best place to start that search is on your W-2.

The EIN for a public company can be found on their Investor Relations website or their SEC Filings page.

If the company doesn’t post its SEC filings online, you can use the SEC EDGAR online Forms and Filings database to find an EIN.

 Conclusion

The process of obtaining an EIN as a foreign individual or entity is tedious, but it does not need to be stressful. Reach out to Lloyd & Mousilli to help determine whether or not an EIN is necessary for you, and to begin the process.

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