What is a federal number?

A federal number, commonly called an Employer Identification Number (EIN), is a unique identifier assigned to businesses by the Internal Revenue Service (IRS) for tax reporting purposes. It functions like a Social Security Number (SSN) for companies and is used for payroll, tax filings, and business banking.

For businesses using Homebase payroll, having a federal number (EIN) ensures compliance with tax laws and simplifies payroll tax filings.

Why do businesses need a federal number (EIN)?

Businesses need a federal number (EIN) for several important reasons:

• Hiring employees and processing payroll: Employers need an EIN to report wages and withhold payroll taxes.
• Filing federal tax returns: Businesses use an EIN to file income, payroll, and unemployment tax forms.
• Opening business bank accounts: Most banks require an EIN to open a business account.
• Applying for licenses and permits: Certain industries and states require an EIN to operate legally.
• Establishing business credit: An EIN helps businesses separate their personal and company finances.

How to apply for a federal number (EIN)

Applying for an EIN is a straightforward process. Here are the options:

• Online application (fastest method):
  
  1. Visit the IRS EIN application page.
  2. Complete the application and receive your EIN immediately.
• By mail or fax:
  
  1. Complete Form SS-4.
  2. Mail or fax it to the IRS (note that this method has a longer processing time).
• By phone (for international applicants): Call the IRS if you don’t have a U.S. address, and apply over the phone.

What forms require a federal number (EIN)?

Employers must use their EIN when filing a variety of forms, including:

• Payroll tax forms (Form 941, Form 940)
• Wage reporting forms (W-2s, 1099s)
• Business income tax returns (Form 1120, Form 1065, Schedule C)
• Unemployment tax filings

What if you lose your federal number (EIN)?

Don’t panic if you misplace your EIN. Here’s what to do:

• Check IRS documents: Your EIN will be on previous tax forms and correspondence.
• Contact the IRS Business & Specialty Tax Line: Call 1-800-829-4933 to retrieve your EIN.
• Look at business bank statements: Your EIN might be listed on bank paperwork.

Be sure to keep your EIN secure to prevent compliance issues in the future.

How Homebase helps with EIN compliance and payroll

Managing payroll tax compliance doesn’t have to be complicated. Homebase simplifies the process by:

• Ensuring payroll tax compliance with your EIN
• Automating tax calculations and filings to save you time
• Tracking EIN-related documents for easy access
• Keeping your business compliant with both federal and state regulations

Let Homebase handle your payroll and EIN tax filings so you can focus on growing your business.

Related articles

• Electronic Federal Tax Payment System: A Guide for Small Businesses
• How to Hire Your First Employee: 5 Easy-to-Follow Steps
• New employee forms for your onboarding process

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