EINs for foreign-owned businesses: when you need one, and how to get it

Obtaining an Employer Identification Number (EIN) is one of the first administrative steps many foreign founders take when establishing a U.S. business presence. It's a federal tax identification number issued by the IRS, used to identify a business for tax and reporting purposes.

Whether you're forming a U.S. subsidiary, opening a bank account, hiring employees, or meeting federal filing requirements, an EIN is often a necessary first step. Understanding when one is required — and how to obtain it without a U.S. Social Security Number — can save weeks of delay as your business expands into the United States.

This article is general information, not legal or tax advice. A foreign entity's U.S. obligations depend on its structure, ownership, and activities.

01What an EIN actually is

An EIN functions much like a Social Security Number for a business. It lets the IRS track tax filings, payments, and the other reporting obligations tied to the entity.

Many foreign entrepreneurs assume that obtaining an EIN automatically creates a U.S. tax filing obligation. It doesn't. The EIN is simply an identification number — whether a filing obligation exists depends on the entity's activities, structure, and connection to the United States, not on whether it holds an EIN.

An EIN is commonly required to:

• Open a U.S. business bank account;
• Hire U.S. employees;
• File federal tax returns;
• Make certain tax elections;
• Obtain business licenses or permits; and
• Work with U.S. vendors, customers, and payment processors.

02Why foreign entities need one

For many foreign-owned businesses, an EIN becomes necessary shortly after formation.

Financial institutions generally require an EIN before opening a business account. Employers must have one to report payroll taxes and employee wages. And certain federal tax forms simply cannot be filed without it.

Even businesses with no employees may need an EIN if they're required to file information returns or other federal forms. Foreign-owned U.S. entities, for instance, often have annual IRS reporting obligations regardless of profitability. Obtaining the number early helps avoid delays when banking, fundraising, hiring, or entering commercial agreements.

03Who is eligible

Foreign entities that can obtain an EIN include:

• Foreign corporations;
• Foreign partnerships;
• U.S. entities owned by foreign individuals;
• Foreign-owned LLCs; and
• Non-U.S. individuals conducting business activities that require an EIN.

When you apply, the IRS generally asks for:

• The legal name of the entity;
• Its country of formation;
• A mailing address;
• Responsible party information;
• A description of the business activity;
• The reason for applying; and
• The expected number of employees, if any.

Importantly, the responsible party does not need a Social Security Number for the entity to obtain an EIN.

04ITIN vs. EIN

An Individual Taxpayer Identification Number (ITIN) and an EIN are easy to confuse, but they serve different purposes.

An ITIN is issued to an individual who needs a U.S. taxpayer identification number but isn't eligible for a Social Security Number. It's used mainly for personal tax filings. An EIN is issued to a business entity and is used for business tax reporting and administrative purposes.

A foreign founder may hold both — but they aren't interchangeable. One identifies the person; the other identifies the business.

05How to apply

The application itself is relatively straightforward once the required information is in hand. Applicants complete IRS Form SS-4, which asks for basic details about the entity and its responsible party.

Accuracy matters. Errors in the entity name, address, ownership, or responsible-party details are the most common cause of delay, so check everything against your formation documents before submitting.

By fax or mail

Many foreign-owned businesses obtain their EIN by submitting Form SS-4 by fax or mail. Fax submissions are generally processed faster than mailed applications, though processing times vary with IRS workload and staffing.

By phone

International applicants may also apply by phone through the IRS international EIN unit. A representative reviews the information on your Form SS-4 and can assign an EIN during the call if all the requirements are satisfied — often the fastest route for foreign applicants who qualify.

Online

The IRS online EIN application is available only in certain situations and generally requires the responsible party to have a valid taxpayer identification number. Many foreign-owned businesses therefore can't use it, and apply by phone, fax, or mail instead.

06Common challenges

Language barriers

IRS forms and instructions often contain technical terminology that can be difficult for non-native English speakers. Reviewing Form SS-4 carefully — and getting help where needed — prevents errors that delay processing.

Missing or incorrect information

Incomplete applications are one of the most common causes of delay. Before submitting, verify that the entity name, formation details, addresses, and responsible-party information are accurate and consistent with your formation documents.

IRS processing delays

Processing times fluctuate throughout the year. Keep copies of every form you submit and a record of any correspondence with the IRS — it makes resolving a delay far easier.

07Using your EIN

Once issued, an EIN becomes the permanent federal identification number for the business. You'll use it for:

• Federal tax filings;
• Payroll reporting;
• Banking relationships;
• Vendor onboarding;
• Tax elections;
• State registrations; and
• Information reporting requirements.

Because the EIN is tied to the entity, keep it in the company's permanent records.

Tax reporting and compliance

An EIN is frequently required to file federal tax and information returns. Depending on your structure and activities, the business may need to file corporate income tax returns, partnership returns, payroll tax returns, information returns, or international reporting forms. The EIN doesn't determine whether a filing obligation exists — but it's usually necessary to satisfy that obligation once it arises.

Banking and financial transactions

Most U.S. financial institutions require an EIN before opening a business account. A dedicated business account separates personal and business finances, supports clean bookkeeping, and makes tax and reporting compliance far easier. Payment processors, lenders, investors, and business partners may request the EIN as well.

08Closing an EIN account

An EIN remains permanently assigned to the entity and can never be reused by another business.

If the business ceases operations, file all required tax returns and resolve any outstanding obligations. The IRS can then close the EIN account associated with the entity — though the EIN itself stays permanently assigned. Significant changes in entity structure may require obtaining a new EIN altogether.

Before you apply

Obtaining an EIN is usually just one part of establishing a compliant U.S. presence. Foreign-owned businesses may also need to register with state authorities, obtain local licenses, meet payroll and employment obligations, and satisfy international reporting requirements. Treaty provisions, entity structure, ownership, and activities can all shape what's actually due.

This article is general information, not legal or tax advice. Federal and state rules are fact-specific and change over time. Talk to us before applying so your EIN, entity structure, and U.S. reporting strategy are aligned from the start.