Social Security Numbers Essay

If you own and operate a business, you may be required to obtain a Federal Employer Identification Number (EIN) and should consider doing so even if not required. Commonly referred to as a federal tax ID number, an EIN is like a social security number for your business. Just as your social security number is used to identify you as a unique individual by government, financial and other institutions, an employer identification number is used to identify a business as a unique entity by government, financial, tax and regulatory agencies. Obtaining and using an EIN to identify your business to the Internal Revenue Service and the various federal agencies that regulate businesses is a smart way to separate and differentiate between your personal and business obligations and liabilities.

Issued by the IRS as a tax identification number, an EIN is a unique identifier assigned and tied to the individual owner of a specific business. EINs are used by employers,
This allows business owners to capitalize on tax, financial or regulatory advantages developed in previous years. As long as business ownership and operating status do not change, your EIN follows your business through the inevitable cosmetic and directional changes that accompany the definition and growth of a business. You can use the same EIN even if you change the name or address of your business or add additional locations. However, because an EIN is issued to the specific owner of a business and not to the business itself, a change in ownership necessitates obtaining a new EIN. A new EIN must also be obtained if the status of your business changes; for instance, if you incorporate your business or take on partners and begin operating as a partnership. A new EIN is also required when a business files for bankruptcy or establishes a profit sharing or retirement