Definition: A 9-digit number obtained by a business with paid employees from
the IRS. If you're a sole proprietorship, your EIN is your social
security number.
If you have one or more employees, you're required to withhold
income tax and Social Security tax from each employee's paycheck
and remit these amounts to the appropriate agency. To do so, you
need to obtain an employer identification number from the IRS using
Form SS-4; if your state has an income tax, you need to obtain a
number from the state as well. Call your local IRS office, which
will send you a copy of the form to file along with charts to
determine payroll tax deductions, quarterly and annual forms, W-4
forms, tax-deposit forms, and a manual on filling out the forms. No
advance fees or deposits are required.