Registering for a Federal Employer Identification Number ( FEIN Federal Employer Identification Number )
In order to avoid misapplication of tax payments, agencies assign each employer a unique Employer Identification Number ( EIN Employer Identification Number ). This number is required to report employment taxes and make deposits.
The Federal EIN is a nine-digit number issued in the following format: 12-3456789. This ID number is issued to your company's legal name, not to a DBA (Doing Business As) name or trade name.
There are two ways you can register with the IRS and receive an EIN:
• Complete and mail Form SS-4
• Call the IRS and provide SS-4 data over the telephone
A copy of federal Form SS-4 is included for your review in the Reports and Forms chapter. If you choose to mail this form to the IRS, it will take approximately four weeks to receive your EIN in the mail. If you provide the data to the IRS over the telephone, an EIN will be issued to you immediately.
Registering with state and local agencies
The procedures for registering with state and local agencies are similar to federal registration procedures, that is, information pertaining to your company must be provided to the agency. Generally, completion of the agency form(s) provides the information the agencies require. You can obtain these forms in a variety of ways:
Request forms from the state/local agency by mail or phone - Your Tax Service Representative can assist you with obtaining the agency address. Or,
Print state forms from agency's Internet site - The Tax Service has compiled an Agency Internet Addresses chart for your convenience. Note: Agency Internet addresses are subject to rapid change. Or,
Request state forms from your Tax Service Representative. Your Tax Service Representative has access to most state registration forms.
Some agencies have made the registration process virtually painless; California will take your company's information over the phone and assign your company's ID number immediately. Maryland allows you to use their interactive Internet site and print a confirmation with your new ID number. Most agencies, however, handle their registration process by mail. After submitting your registration form, the length of time in which you will obtain an ID number will vary from agency to agency.
From the point in time when your company submits the registration form and the time when the agency assigns an ID number, most agencies do not recognize your company as a valid, or legitimate, employer in their area. It is during this period that the Tax Service refers to your ID number status as "Applied For", or AF Applied For , when your company has not yet been issued a valid agency ID number. Applied For status can seriously limit your company's capability in meeting an agency's deposit and reporting requirements.
Applied For Status
Stringent requirements are created by tax agencies for making deposits and reporting of wages to your company's registered account. Not all agencies will even accept deposits and/or returns for companies in an Applied For (AF) status; technically, your company does not exist.
Companies submitting deposits and/or returns to agencies which will accept AF deposits run the risk of misapplication of their deposits and the potential for penalty assessments by the agency. Without an assigned ID, these states will not accept wage detail or returns on magnetic media; therefore, the Tax Service will print the wage detail and return on paper. Since this format does not comply with the agency's requirements, the agency may impose a penalty to your company.
You will receive a current state listing in the QE Planner sent to you each quarter.
While the Federal EIN is used for all federal payroll taxes, different agencies within a state issue their own EIN. Therefore, along with registering for a Federal EIN, you will also need to obtain an EIN from:
• State unemployment agencies
• State and local income tax agencies
While every state unemployment agency issues its own EIN, some state income tax agencies use the Federal EIN.
State and local EINs vary in length and format from one jurisdiction to another. While the procedures for registering for state and local EINs are similar to federal registration procedures, the time in which employers obtain an EIN after applying for one will vary in these jurisdictions. Some agencies will allow you apply for an EIN over the telephone and will assign a number immediately.
Your account representative can assist you in obtaining copies of registration forms and/or phone numbers and email addresses for state agencies. In addition to your service representative, you can refer to the Agency Internet Addresses section in the Reference chapter.
Applied-For EINs
If you are entering into business in a new state, you may be able to obtain Applied For (AF) status. This may allow the Tax Service to file your taxes with state and local agencies for a limited period of time before you are assigned a valid EIN.
Not all agencies accept AF status. Many discourage this practice because these filings must be processed manually. It is important to register with these agencies and obtain their ID as soon as possible in order to avoid any misapplication of tax funds, potential penalty assessments, and other restrictions.
Some state agencies will allow you to report and deposit taxes under an AF status prior to their assignment of a permanent ID number. Other agencies require a valid ID number on all deposits and returns. See the QE Planner distributed at the end of each quarter for the requirements of specific agencies.
If you are able to file with AF status, the following restrictions may be applied:
Most agencies will not accept deposits and/or returns filed under an AF status without a copy of your registration form.
States will not accept filing on magnetic media without an assigned ID. This poses a problem since some agencies require data to be filed on magnetic media and impose a penalty to your company if not in compliance.
To avoid these problems, you must register with all applicable state and local agencies immediately upon entering a new jurisdiction. If you are required to file with an agency for a limited period of time prior to receiving an assigned identification number and a payment is allowed by this agency, make sure the Tax Service has a copy of your completed agency registration form to attach to deposits and returns.