Common mistakes
The most common mistake is using the owner SSN where an EIN is required, which causes the bank to reject the account application or the IRS to reject the tax return. The second is applying for a second EIN for the same entity, which the IRS will not issue and which causes confusion in the IRS records. The third is using a third-party service that charges for the application, which is unnecessary because the IRS issues EINs for free.
The right call is to apply directly through the IRS, to use the legal name of the entity on the application, and to enter the responsible party with the SSN or ITIN correctly.
If the application fails
If the application fails because the entity is not yet registered with the state, the right call is to complete the state registration first, then return to the EIN application. The IRS validates the legal name against the state records for entities that require state registration.
If the application fails because of an SSN mismatch, the right call is to verify the SSN with the responsible party and to retry the application. The right call is to call the IRS Business and Specialty Tax Line at 800-829-4933 if the issue persists.
After the EIN is issued
After the EIN is issued, the right call is to enter the EIN into the IRS records by using it on the first tax return, the first payroll filing, or the business bank account application. The EIN does not need to be registered with the IRS separately; it is active as soon as it is issued.
Common mistakes to avoid
The most common mistake is to use the owner SSN where an EIN is required. The right call is to apply for the EIN first, and to use the EIN on the first tax return, the first payroll filing, or the business bank account application. The EIN is required the moment the business has employees or files as a partnership or corporation.
The second most common mistake is to apply for a second EIN for the same entity. The right call is to call the IRS Business and Specialty Tax Line at 800-829-4933 to correct the existing EIN, not to apply for a new one. The IRS will not issue a second EIN for the same entity.
The third most common mistake is to use a third-party service that charges for the application. The right call is to apply directly through the IRS, which is free. The third-party services charge 50 to 200 dollars for the same application that the IRS issues for free.
The honest short version
The IRS EIN online application in 2026 is free, takes about 15 minutes, and issues the EIN immediately. The application is at irs.gov and requires the legal name, the mailing address, the responsible party, and the principal business activity. The right call is to apply directly through the IRS and to use the EIN on the next tax return or business bank account application.
Photo: geralt, Pixabay Content License, via Pixabay (https://pixabay.com/photos/application-online-job-application-2860023/)
Fazlur Rahman
