Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Who assigns the employer identification number (EIN)
Expert Solution
Meaning of employer identification number?
Meaning:
An employer identification number is a unique 9-digit number that is issued to every business unit in the United States and is issued for the purpose of reporting tax. Therefore, it is also known as a federal tax identification number.
A few key points about the employer identification number:
- It is issued by the Internal Revenue Service, also known as the IRS, to distinguish similar business entities from one another for tax purposes.
- The business must be located in the United States.
- Employer identification numbers also allow the business entities to open their bank accounts and apply for credit as well.
- Businesses can apply for an EIN on the IRS's official website and receive it immediately by submitting the required documents.
- EINS have the format XX-XXXXXX and include information about the state in which the business entity is registered .
Who can apply for Ein?
All forms of business, whether small or big, can apply for an EIN, including;-
- non-profit organization
- government agencies
- Limited liability companies
- sole proprietors
- trusts
- companies
- partnerships
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