The Internal Revenue Service (IRS) issues employers with an Employer Identification Number (EIN) as a tax identification number. If a business in Tennessee has workers or is categorized as a partnership or corporation, they must obtain an EIN. How much does an EIN cost in Tennessee is one of the most often asked topics by business owners and entrepreneurs in the state.
The good news is that an EIN may be obtained for free in Tennessee. That’s true, applying for an EIN from the IRS doesn’t cost anything. For your Tennessee company, you can apply for an EIN online, by mail, fax, or phone. The procedure is straightforward and doesn’t require much time.
There is a common misunderstanding that an EIN and a Tax ID are the same. An EIN is a special identifying number that the IRS issues to businesses for tax-related reasons. The word “Tax ID,” on the other hand, refers to a variety of identifying numbers that are given to firms by various departments and authorities.
For instance, a company in Tennessee might have an EIN, a sales tax ID number, and a state tax ID number. These identification codes each have a distinct function. The Tennessee Department of Revenue issues the state tax ID number for use with state taxes. Businesses who sell goods and services and are obligated to collect sales tax are given a sales tax ID number. The IRS issues the federal tax ID number (EIN) for use with federal taxes.
Finally, getting an EIN in Tennessee is cost-free. Getting an EIN from the IRS is crucial if you’re beginning a business in Tennessee, especially if you want to recruit staff or form a corporation or partnership. Keep in mind that an EIN differs from a Tax ID. Make sure to acquire all the identifying numbers required for your company, such as the state tax ID number and, if appropriate, the sales tax ID number.