As the saying goes, nothing is certain but death and taxes.
The U.S. government makes sure each and every one of us chip in our fair share of taxes, and with taxpayer identification numbers, we’re required to do just that.
Whether you’re an American taxpayer, a resident alien, or a small business owner, you’ll need at least one form of a taxpayer identification number — or TIN — for taxation and identification purposes.
In this article, we’re going to lay out the differences between the various taxpayer identification numbers and show you how you can go about obtaining each TIN number.
- What Are Taxpayer Identification Numbers?
- Types of Taxpayer Identification Numbers
- Social Security Number (SSN)
- Employer Identification Number (EIN)
- Individual Taxpayer Identification Number (ITIN)
- Taxpayer Identification Number FAQs
- The Right Tax ID for You
What Are Taxpayer Identification Numbers?
Taxpayer Identification Numbers are used to track payments between businesses and individuals. By using a federally distributed taxpayer identification number, businesses and individuals can legally track income and payment.
Anytime you’re required to fill out tax returns, income statements, and other tax documents from the Internal Revenue Service — or IRS — you’ll need to provide one of these numbers for legal identification purposes.
Depending on whether you’re an individual looking for your personal tax number, a resident or non-resident alien, or a small business owner, you’ll need to know which number to use and when to use it. So what are the different types of Taxpayer Identification Numbers?
Types of Taxpayer Identification Numbers
There are several different Taxpayer Identification Numbers that are available for U.S. residents, aliens, and businesses to use. The following tax identification number is issued by the Social Security Administration (SSA).
- Social Security number (SSN): This is the most popular identification number for individuals, including U.S. citizens, permanent residents, and temporary non-immigrant workers.
For those instances when an SSN isn’t applicable, the following tax identification numbers are issued by the IRS.
- Employer Identification Number (EIN): This number is used for businesses rather than individuals, however, your business doesn’t necessarily need employees to use this number.
- Individual Taxpayer Identification Number (ITIN): This number is for individuals that aren’t able to receive an SSN or an EIN — like resident aliens or non-resident aliens, their spouses, and dependants.
- Adoption Taxpayer Identification Number (ATIN): This is a temporary tax number for individuals who are in the process of adopting but were unable to get an SSN for the adopted child in time to claim the child as a dependent when filing taxes.
- Preparer Tax Identification Number (PTIN): This is a tax number specifically for those who are paid to file taxes on behalf of others.
Since ATINs and PTINs are not nearly as popular or widely used, we’ll go in depth on the remaining three: SSN, EIN, and ITIN.
Social Security numbers are issued by the Social Security Administration and are used as the main form of identification for many individuals within the United States.
First started as a means to track earnings under the Social Security program, Social Security Numbers quickly turned into the national identification number for individuals. These nine-digit numbers are now used to keep track of personal records — as well as for taxation purposes — and are formatted XXX-XX-XXXX.
Not only are SSNs used for filing taxes with the IRS, they can also be used for the following purposes:
- Obtaining a passport
- Opening individual bank accounts, loans, and securities
- Accessing federal benefits
- Applying for Medicare
- Obtaining federal loans
- Registering a motor vehicle
- Registering to vote
You might think that US citizens are the only people who are given an SSN, but there are also others who can obtain one.
Who Can Get an SSN?
Not everyone is able to obtain a Social Security Number. Among those who are eligible are:
- U.S. Citizens: Those who are granted the rights, benefits, duties, and responsibilities covered by the United States Constitution.
- Permanent Residents: Those who are legally allowed to permanently live and work in the United States.
- Temporary Non-Immigrant Workers: Those who have residency outside of the United States but are temporarily in the country for work, school, or business.
If you don’t have an SSN and need to obtain one, there are a few options to apply.
How to Get an SSN
If you fall into one of the three categories mentioned above, then you qualify to apply for a Social Security Number.
If you’re an immigrant, you’ll be required to apply for your SSN within your home country. When you’re applying for your Immigrant Visa, you can also apply for your SSN. Both of these can be done at the Social Security Field Office within your country.
To help you speed up the process, we’ve provided links below to get you started.
- Information on Social Security Numbers and Immigrant Visas
- Foreign Workers and Social Security Number FAQs
- Find an International Social Security Office
If you’re not an immigrant, then you can apply for your SSN within the United States at a domestic office. If you’ve just arrived in the country from abroad — whether you’re a U.S. citizen, permanent resident, or temporary nonimmigrant worker — then you should wait at least 10 days to make sure you’re approved through the Department of Homeland Security database.
In order to find a Social Security Office in the United States, you can head to the link below.
But what if you’re operating a business. Do you use your Social Security Number or should you apply for an EIN number?
Employer Identification Number (EIN)
An Employer Identification Number is a unique identifier that’s used by those doing business in the United States. Think of it as a Social Security number but for business entities.
Employer Identification Numbers are nine digits long and are formatted as XX—XXXXXXX. EINs are also known as Federal Employer Identification Numbers or Federal Tax Identification Numbers.
Beyond just being the identification number for tax purposes, EINs are also used by businesses when they need to open a business bank account, take out a business loan, and apply for business licenses and business permits.
EINs are needed for all business entities that are registered through the IRS. This includes LLCs, partnerships, and corporations. The one exception to this rule is single-member LLCs. If you’re the sole proprietor of your business, you can use your Social Security Number instead of an EIN.
How to Get an EIN
Depending on whether or not you have an SSN or ITIN, there are two ways you can go about obtaining an EIN. If you already have an SSN or ITIN, then this process can be done online. If you don’t have either of these, then you’ll be required to fill out the Form SS-4 and mail it to the IRS.
- Have an SSN or ITIN: Apply for an EIN online at the IRS website
- Don’t have an SSN or ITIN: Fill out this form and follow these instructions
If you aren’t looking for an SSN or an EIN, let’s move on to Individual Taxpayer Identification Numbers.
Individual Taxpayer Identification Number (ITIN)
Individual Taxpayer Identification Numbers are used by those who aren’t able to obtain a Social Security Number but must still file taxes and other reports with the IRS.
Like a Social Security Number, ITINs are also nine digits long. They start with the number “9,” and are formatted as 9XX-XX-XXXX. They’re used for tax purposes only and cannot be used as identification, to receive Social Security benefits, or to authorize you to work in the United States.
ITINs are used by those who are non-resident aliens or resident aliens who don’t have an SSN — as well as their dependents and spouses.
How to Get an ITIN
Taxpayer Identification Number FAQs
If you’re still confused as to which tax ID number you should use for business and personal use, here are some common questions people have.
1. I own my own business. Should I use my SSN or an EIN?
If you’re operating a sole proprietorship, then you can simply use your SSN for tax purposes. Since your business’s earnings will come through your personal US tax return, this is the only federal tax ID number you’ll need.
If you operate any type of business that isn’t a sole proprietorship — like an LLC, partnership, or corporation — then you’ll need to have an EIN number, even if your company doesn’t have any employees or payroll.
You will also need to look into obtaining a state tax ID number on top of your federal ID number to legally report state-level information, like sales tax.
2. Which taxpayer ID number do I use on my income tax form?
Most people who have a Social Security number should use this ID for tax purposes. Those individuals who don’t have an SSN will use an ITIN instead. All businesses will use an EIN when filing taxes unless the business is a sole proprietorship. If this is the case, then an SSN can be used.
The Right Tax ID for You
While all of these acronyms make it feel like alphabet soup, it’s really quite straightforward as to which tax ID you should use.
For the most part, if you’re a U.S. resident, you’ll use your SSN on tax forms. If you’re not able to obtain an SSN, then you’ll use an ITIN. And if you own a business that isn’t a sole proprietorship, then you’ll rely on an EIN for all tax purposes.
If you’re interested in more tax information we’ve laid out tax write off opportunities for gig workers and ways you can stay on top of taxes if you’re a freelancer.