What is a tax identification number (TIN)?

A taxpayer identification number (sometimes referred to as a TIN) is a unique number issued by the government to an individual or entity. It allows the issuing authority to easily identify taxpayers. In the U.S., the Internal Revenue Service and, in some cases, the Social Security Administration, are responsible at the federal level for issuing these numbers. Businesses obligated to pay state taxes or that perform certain activities in a state may also need to obtain one or more state tax ID numbers. 

What are the different types of tax ID numbers?

The type of tax ID number that an individual or entity may need to obtain depends upon their specific situation. Frequently required tax ID numbers include:

• For Individuals: A Social Security Number (or SSN) is the most common individual tax ID number in the U.S. It is a unique nine-digit number that the Social Security Administration assigns to an individual. 

An alternative individual tax ID number to the SSN is an Individual Taxpayer Identification Number (ITIN). ITINs are available for certain non-citizens and their family members who are unable to obtain an SSN.   

• For Businesses: An Employer Identification Number (EIN) is a federal tax identification number issued by the IRS to a business. Most businesses are required to have an EIN, including any business that has employees. 

How do you get a tax ID number?

To get a Social Security Number, you will need to provide required documentation (such as a birth certificate) proving your identity to the Social Security Administration. Once you’ve gathered the required documents, you may then complete an application for a Social Security card. The completed application can be filed at any Social Security office or mailed to the appropriate address. 

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An ITIN can be obtained by filing a Form W-7, Application for IRS Individual Taxpayer Identification Number, with the IRS. Like the SSN application, it will require you to provide certain documentation substantiating your identity and legal status within the U.S. The completed application can be filed in a number of ways, including by mail, in person at a designated IRS Taxpayer Assistance Center, or through an Acceptance Agent.

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There are several ways for a business to get an EIN. You may file an EIN application by mail, fax, or online (and, in some cases, by telephone). If applying by fax or mail, you must complete Form SS-4, Application for Employer Identification Number, and submit it to the appropriate IRS address or fax number. 

What is a tax ID number used for?

Tax ID numbers are used by different governmental authorities in various ways. Importantly, the IRS uses these numbers to identify taxpayers who are required to file tax returns. The number must be included on tax returns and should also be used in most related correspondence with the IRS. 

For individuals, an SSN is crucial for getting a job, filing your taxes, collecting Social Security benefits, and accessing certain other government services or benefits. The Social Security Administration uses this number to track an individual’s earnings across their lifetime, which informs Social Security benefits calculations. Once an individual begins receiving those benefits, their SSN continues to be used to monitor the individual’s record and track benefits. The use of ITINs is more limited in scope than SSN use. ITINs are used for tax compliance purposes for federal tax reporting.

As with individual tax ID numbers, EINs are used for tax administration and compliance purposes. 

Tax ID numbers around the world

Beyond the U.S., most countries have their own rules and requirements for tax identification numbers. In some places, only entities, not individuals, are required to have a tax ID number. In others, the government does not issue tax ID numbers at all. While there is no shortage of information available online, it is always best practice to seek the advice of a qualified tax professional if you have questions about tax ID numbers or related matters specific to your situation. 

Disclaimer: This article and all information in it is provided for general informational purposes only. It does not and is not intended to, constitute legal or tax advice. You should consult with a qualified legal or tax professional for advice regarding any legal or tax matter and prior to acting (or refraining from acting) on the basis of any information provided on this website.