What is the Difference Between a SSN and a Tax ID?

What is the Difference Between a SSN and a Tax ID?

In the United States, we have a social security number (SSN) that is used as a national identification number for tax reasons and also used to track individuals for social security reasons. Our social security number is commonly used for situations such as opening a bank account, applying for personal credit such as a credit card or loan, and in instances related to health like insurance or medical coverage. On the other hand, a federal tax ID number, also known as TIN (tax identification number) works somewhat the same except for a business rather than an individual person.

A tax ID number is a unique number given to a single business and/or a business that has hired employees. This unique number is used by the IRS for differentiating tax purposes among different businesses. In other words, a social security number is used for identifying people while a tax ID number is used to identify and recognize a legal entity or business.

An EIN number might need to be acquired if you are starting a business and meet any of the following circumstances:

  • You have employees
  • You operate your business as a partnership and/or corporation
  • You file excise, alcohol, tobacco, employment, or firearms tax returns
  • You withhold taxes on revenue, besides pay, paid to a foreign alien
  • You have a Keogh plan
  • You are involved with a trust, IRA, estate, non-profit, real estate mortgage investment conduit, farmers’ cooperative, and/or plan administrator program

If any of these meet your business’s circumstances then you will need to obtain an EIN number Wisconsin, not a tax ID. Luckily, with IRS-EIN-Tax-ID it is a simple and fast process with our 24-hour available online application. All you need to do is fill out the application and usually, you will receive your EIN number within a day!

 

By | 2018-06-05T00:55:30+00:00 June 4th, 2018|Finances, Work|0 Comments

About the Author:

Leave A Comment