Last Updated: February 2, 2023
A Taxpayer Identification Number (TIN) number is essential for each US citizen. But many often confuse TIN with EIN and vice versa. This article outlines the differences between TIN vs EIN and explains all the different types of tax IDs and the purpose of tax numbers, and how to tell them apart.
What Is a Tax ID Number?
A taxpayer identification number (TIN) is a term used by the Internal Revenue Service (IRS) to refer to all the numbers used for identification and taxation purposes. So what is TIN, and when is it used? A TIN is used to track individual income that needs to be filed on federal tax returns—the TIN needs to be listed on each return.
A tax ID number is a nine-digit number unique to individuals, organizations, corporations, and organizations. This number is required when filing returns, claiming benefits or applying for employment and credit. There are several types of tax ID numbers used for different purposes.
How to Get a Tax ID Number
Each individual and organization must have a TIN—since there is more than one, anyone pursuing a number needs to list the exact number they’re applying for. How to get a TIN and from where is a significant concern. To receive this number, you must fill out an application from the government agency responsible for issuing the specified number.
All US tax identification numbers are issued by the IRS, except for a Social Security Number (SSN) issued by the Social Security Administration (SSA). Once the application has been reviewed and approved, the applicants will receive their TINs.
|NOTE: In 2014, the IRS announced that each individual taxpayer identification number (ITIN) that hadn’t been used on a tax return in the past five years would expire.
TIN vs EIN Differences
All tax-related documents require tax identification numbers on the tax form. The numbers most commonly required on such forms are the TIN and the EIN. It’s a common misconception that these two numbers are interchangeable. But before drawing a comparison of EIN vs TIN, we need to identify what an EIN is.
What Is an EIN?
An Employer Identification Number (EIN) is a tax identification number issued by the IRS to business organizations in the US. Companies primarily use this number for taxation purposes—it also needs to be included on all bank accounts, employment reports, payrolls, and applications for licenses and permits.
Estates and trusts also need to file returns if the estate generates income higher than $600.00 per year, must be reported on the 1041 form. It’s a good idea for estate owners to consider the top-rated tax software for form 1041 and simplify the filing process.
What’s the difference between federal tax ID vs EIN? They are virtually the same, except a tax ID number can be issued on the state or federal level, but an EIN is exclusively federal.
Is EIN and Tax ID the Same Thing?
The Internal Revenue Service issues tax ID numbers for different purposes. The Employer Identification Number (EIN) is one of the TIN types mandatory for businesses, while an SSN can be used as identity verification by individuals.
If you’re still wondering if EIN and TIN are the same, you should know that even though both numbers are used for identifying and reporting purposes, the difference is in the specific situations in which you can use the number. Another important distinction is that a regular TIN can be issued on both federal and state levels. In contrast, an EIN is issued only on the federal level, which is why it’s often referred to as a Federal Employment Identification Number (FEIN).
Is EIN the same as tax ID? No. An EIN is just one of the TIN types. In cases where your EIN is required, you can use your TIN, but if your TIN is required, you cannot use an EIN in its place.
All EINs have nine digits and are only issued to legally formed businesses. A new EIN is required any time a company’s owner or business structure is changed.
|NOTE: Americans paid more than $5 billion in taxes in 2019. Besides your TIN, you need to include many other details for tax purposes—it might be good to try the best tax software and let it do the work for you.
|Taxpayer identification numbers (TINs) are obligatory requirements for all US citizens and non-citizens required to file taxes.
|A tax ID number is necessary for paying taxes and filing tax returns and is often used for identification purposes.
|Five different TINs are used for varying purposes: SSNs, EINs, ITINs, ATINs, and PTINs.
|You can file for four of these numbers with the IRS—the only exception being the SSN, which the SSA appoints.
Types of Tax ID Numbers
Different tax identification numbers and understanding the differences between them can make your filing process more manageable. We’ve listed the five types of ID numbers (including TIN vs EIN) that you should be aware of.
Social Security Number (SSN)
- Definition: A Social Security Number (SSN) is issued to all US citizens. It’s the most common number assigned for identification and taxation purposes. Anyone that wants to be employed or collect Social Security benefits needs to have an SSN.
- Purpose: One primary purpose of SSNs is to report yearly income on tax returns. These numbers are also necessary to determine benefit payments, Social Security, and Medicare eligibility. Sometimes, this number is used to determine work eligibility through customs and immigration services.
- How and where to get one: An SSN is issued by the Social Security Administration (SSA). All citizens who are entitled to this number need to fill out the application form SS-5. Those with an SSN need to list it on their tax return, as it is their unique identifying number.
Employer Identification Number (EIN)
- Definition: An EIN is a federal taxpayer identification number issued to businesses. Even though it’s a number assigned to employers, your company doesn’t need to require anyone to have an EIN—the only requirement is that it’s legally established.
- Purpose: The EIN is primarily used for paying business income taxes, but it’s also required when opening a business bank account and applying for a loan, as well as for identifying purposes. Operating a business doesn’t automatically mean that you need to get an EIN. But if you’re running the company as a partnership or a corporation and have employees, or you’re filing employment tax returns, you need to obtain an EIN. If you decide to start a business, you should consider registering an LLC, for which you’ll need an EIN. You can check out the best LLC service here.
- How and where to get one: The main difference between EIN vs TIN is that the IRS issues the EIN, while a TIN (like an SSN) does not. To obtain an EIN, you need to file a different application using form SS-4. Several application options allow you to mail, phone, fax or use an online application.
The recommended route is to file online—you can then get your EIN immediately. The online application process is free, but only US-based businesses can apply for an EIN online. You can also file your company’s taxes online with the help of the popular business tax software.
Individual Taxpayer Identification Number (ITIN)
- Definition: An ITIN is issued only to individuals who are not eligible for an SSN or an EIN, such as US visa holders. This number can be used for taxation purposes if the person filing taxes is a non-resident alien or foreign national required by US tax laws to file a return. Looking at a TIN vs EIN, we can see that ITINs (like EINs) are also nine-digit numbers, but the first digit is always a 9.
- Purpose: The ITIN is used only for tax reporting. It’s impossible to use it for other purposes, such as verification of identity, which is the main difference between other TIN vs ITIN numbers. It’s prohibited to have both a Social Security Number and an ITIN—even if you’ve only filed an SSN application, the IRS will immediately reject your ITIN request.
- How and where to get one: You can apply for an ITIN when filling out a W-7 form, but federal income returns also need to be attached to the application. The IRS issues this number only for those who strictly need it for filing tax returns or processing payments. The process of getting an ITIN is not always easy, so the government provides help from acceptance agents: accounting firms, financial institutions, and similar organizations.
Adoption Taxpayer Identification Number (ATIN)
- Definition: An ATIN is a temporary ID number issued by the IRS to those involved in an adoption process. ATINs are used by new parents who are unable to get a Social Security number for their child. If an adoption is complete, but the child has still not been assigned an SSN, the IRS provides a temporary ATIN for the child.
- Purpose: The purpose of issuing an ATIN is to identify the child as a dependent on tax returns so that parents would be entitled to certain returns or deductions. The tax ID vs EIN comparison requires that a tax ID (such as an ATIN) be used only for individual purposes, while the EIN’s use is strictly for business.
- How and where to get one: If you want to obtain an ATIN for your child, you’ll need to file the IRS form W-7A. You’re required to provide documentation to prove that your child legally lives in your home. Even if the child is adopted from a foreign country, you can get an ATIN, but there are specific procedures you need to go through.
Preparer Taxpayer Identification Number (PTIN)
- Definition: A PTIN is an IRS-required number for all certified tax preparers or anyone that prepares federal returns for compensation. If clients opt to have their returns filed through a preparer, a PTIN needs to be visible on the return. Many are choosing an affordable tax service to file their returns.
- Purpose: A PTIN is used to ensure the privacy of the preparer. In the past, preparers would use their own SSNs on tax returns, which would leave them vulnerable to identity theft. PTINs were introduced to prevent this. Preparers must obtain this number at the beginning of their career. And what if your FEIN is the same as TIN? FEINs are obtained for companies, while licensed individuals get PTINs.
- How and where to get one: The process of obtaining a PTIN is relatively simple. The future preparer needs to fill out a W-12 form with the IRS, which should take about 15 minutes online. It isn’t advisable to mail the documents via regular post because the response time would take about four to six weeks.
Taxes are complicated, and tax numbers add even more confusion to the mix. It would be helpful to familiarize yourself with the provided numbers, so you’ll know which one you need for taxation purposes. If you compare TIN versus EIN, you’ll see that a TIN refers to all types of numbers for various reasons, while an EIN is used only in clearly defined circumstances.
A TIN is a nine-digit taxpayer identification number issued by the IRS to individuals or organizations. These numbers are used for ID and tax purposes.
A Federal Employment Identification Number (FEIN) is identical to an Employer Identification Number (EIN). Confusion arises only when an EIN is incorrectly used to refer to a state ID number. The difference between TIN vs EIN is that TINs are used for state taxes, while EINs are used strictly on the federal level.
To get an Individual Taxpayer Identification Number, you need to fill out the W-7 IRS form and provide documentation that proves your identity, as well as your alien/foreign status.