How to Verify an EIN Number

If the EIN owner cannot find your EIN confirmation letter from the IRS, contact the IRS. If the person who needs to retrieve the EIN is not an authorized representative of the company, he or she may request that an actual authorized representative complete IRS Form 2848 Tax Information Authorization.

Brad Nakase, Attorney

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Tom is preparing to open his brand-new bar in Venice Beach. The space has been perfectly designed to reflect his aesthetic, and he has a whole menu of classic and signature cocktails for patrons to enjoy. Tom has put many months and endless hours into creating his bar, and now he is ready to set up a business account at his local bank and to hire employees. However, when Tom arrives at the bank for his appointment to set up a business account, they tell him that he needs to provide his EIN. EIN? He doesn’t know what this is. The person at the bank, who is very helpful, tells Tom that an EIN is an Employment Identification Number, similar to his personal social security number (SSN). Every business that wants to open a business account needs to have an EIN. Okay, thinks Tom, then I’ll start with hiring my employees. Nope! The teller informs him that he also needs to get his EIN before hiring any employees. Well, Tom wonders, how do I go about getting this EIN? The kind bank employee tells him that he can go onto the IRS website and apply to receive or verify an EIN number for his business.

How to Verify an EIN Number

An Employer Identification Number, also known as an EIN, is a nine-digit number used for tax identification. It is issued by the Internal Revenue Service (IRS). It functions much like a social security number does for an individual, only for a business. Whether personal or business, tax identification numbers like the EIN are private. Therefore, it is not easy to verify an EIN unless the person doing the verifying has the authority to act on behalf of the business. Registered nonprofit and tax-exempt organizations are the exception to the rule.

If an EIN is Lost

Authorized representatives of a company can call the IRS and confirm or verify a business EIN. A business owner is automatically an authorized representative. Other authorized representatives of a business may include company officers, sole proprietors, partners, and trustees or executors of estates.

The verification process is simple. The authorized representative will call the IRS at (800) 829-4933. After receiving some identifying information, the IRS representative will provide the EIN number over the phone.

When Not an Authorized Representative

If the person who needs to retrieve the EIN is not an authorized representative of the company, he or she may request that an actual authorized representative complete IRS Form 2848 Tax Information Authorization. Ironically, the form requires an EIN. This means that if the company in question has lost or misplaced its EIN, then an authorized representative from the company must call the IRS.

Exempt Organizations

If an individual wishes to verify a charitable company’s EIN, then he or she should proceed to the IRS website and complete an Exempt Organization select Check. This is an IRS tool used to verify information about nonprofits. Because these businesses are not-for-profit, their information is public record. An individual can search for a business using the search tool and see the EIN to verify tax deductible donations. It is also possible to see the status of the charity.

The IRS system will let one know if the business has its tax-exempt status taken away for not filing Form 990-N. This form is responsible for verifying the amount of income a business has. So, even though the company is tax-exempt, it still has to file and report income to the IRS. If it does not do this, then it can lose its charitable, tax-exempt status.

Other Ways to Verify an EIN

It is possible to retrieve an EIN via other sources. It is true that an EIN is private information, but employers will generally be okay with confirming an EIN if requested. An EIN number is used on payroll checks and provided on contractors’ 1099s. An incorrect EIN can cause the IRS to reject personal or business tax returns. It can also lead to the IRS refusing requests for other information due to inconsistencies in data. If this occurs, then the verifying an EIN is required to prevent understating and overstating income.

It is also possible to verify an EIN by running a credit history. If an individual has a company’s EIN and is authorized to perform a credit check, then the credit report will verify the name of the business and the address associated with the EIN.

The Process of Verifying an EIN

An Employer Identification Number (EIN) is a critical financial element of a business. An EIN is required to file credit applications, tax returns, and state licenses and permits. Without this number, a business will stall, unable to grow or perform necessary activities. Like an individual’s social security number (SSN), an EIN is a nine-digit number provided by the Internal Revenue Service (IRS). This number is private, so in order to verify an EIN, one must have a certain amount of authority. If an individual is not an authorized representative of the company in question, then he or she must receive authorization prior to EIN verification.

Calling the IRS

The IRS is responsible for providing and maintaining records for EINs. If an individual is authorized to verify an EIN, then he or she may call the IRS to get this information. Usually, this is relevant is a company’s EIN is lost or misplaced. Authorized individuals able to act on behalf of the company in this way may include:

  • Sole proprietor
  • Corporate officer
  • Trustee
  • Estate executor

To call the IRS, an authorized individual may call the Business and Specialty Tax Line. This line is open Monday through Friday, from 7 AM to 7 PM EST. The number is (800) 829-4933.

Nonprofit Exemption

In order to verify an EIN for a business, one must be an authorized individual. However, this rule does not apply to nonprofit entities. Nonprofits are required to maintain public records. This means that anyone can access this information from the IRS. Similarly, if one requests the EIN from a nonprofit, by law the nonprofit must provide it.

One can look up a nonprofit organization on the Exempt Organization page on the IRS website. This site will verify EINs of nonprofits but will also reveal if the organization is in good standing with the IRS. What does good standing mean? A company in good standing is current on tax returns and filings. This site will also show if the organization has had its nonprofit status taken away.

Other Ways to Verify

A non-authorized person requesting an EIN must have a legitimate reason to ask for it. An example of a legitimate reason would be a loan officer needing to verify a company’s EIN for a loan. This loan officer would need authorization in the form of a signed credit application that includes the EIN, company name, address, and officer information. This kind of verification comes with fees.

An investor or business partner can request that a company verify its EIN by providing previous tax returns. While private companies do not have to provide this information, it is often in their best interest to do so when negotiating. If concerned about the company’s financial health, potential partners or investors can always conduct a Dun & Bradstreet search.

Paycheck

An employee can see his or her company’s EIN on their paycheck or W-2. It is important that these two numbers match. If they do not, the IRS can reject a tax return with an incorrect EIN. If this occurs, then the payroll representative will need to verify the EIN number so that payroll is properly conducted and recorded.

Learn more about: Business | Corporate | Employment Law

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