What Is an FEIN?

small business ownerFEIN is an acronym for Federal Employer Identification Number, also known as an EIN. This unique nine-digit number is used by the Internal Revenue Service (IRS) to identify a business operating in the United States.

The FEIN is issued in the following format:
01-2345678.  In contrast, Social Security numbers are issued as 012-34-567. This identification number normally remains permanently connected to the business and is not reused or assigned to another business.

Federal Employer Identification Numbers are issued to partnerships, corporations, non-profit organizations, and to other business entities. Sole proprietors can operate using the Social Security number of the business owner unless there are employees or certain retirement benefits involved.  Anytime employees become a factor, FEINs are required.

The FEIN application is available on the IRS web site along with useful information. Other ways to obtain the FEIN including requesting IRS Form SS-4 by mail or completing the online SS-4.  Instructions for filing Form SS-4 are available on the IRS web site.

Once issued, the FEIN should remain attached to the business until a qualifying change is made or the business requests the FEIN be retired. A qualifying change would include a sole proprietorship changing entities and becoming a corporation, a corporation changing to a partnership, and a partnership adding a new partner to the business. In general, the FEIN does not need to be changed if the business decides to change the name, address, phone number, or location, provided the business remains in the United States.

Although the IRS cannot simply cancel the assigned FEIN, the account can be closed at  the request of the business. Closing the account may be the best option if the FEIN was requested, but the business was never opened. Regardless, the FEIN still belongs to the business entity and can be reactivated at a later date if necessary. The FEIN does not expire.

Business owners who need to close their FEIN account and are operating for profit should mail a letter to the IRS in Cincinnati, OH 45999, including the business name, legal name if different, the business address, and FEIN. Owners of non-profit businesses who decide to close their FEIN can mail a similar request to IRS, Attn: EO Entity, Mail Stop 6273, Ogden, UT 84201.

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