EIN vs SSN: What's the Difference? (2026)

The IRS has issued over 36 million active EINs to US business entities as of 2024. An Employer Identification Number (EIN) is a unique 9-digit number assigned by the Internal Revenue Service (IRS) to identify a business entity for tax purposes. Every LLC, corporation, partnership, nonprofit, trust, and estate operating in the United States needs an EIN. Think of it as your business's Social Security Number, except it carries far less privacy risk because it is not tied to personal credit or government benefits.

EIN Format and Structure

The EIN format is XX-XXXXXXX (two digits, a hyphen, then seven digits). The first two digits indicate the IRS campus that issued the number. You use your EIN to file business tax returns, open a business bank account, apply for business licenses, hire employees, and establish business credit. The IRS issues EINs at no cost. US residents with an SSN can apply online at irs.gov in minutes. Non-residents without an SSN file Form SS-4 by fax, which takes 7 to 14 business days.

EIN Application Methods Compared

4 methods exist for obtaining an EIN. Online takes under 10 minutes with instant issuance. Fax takes 4-7 business days. Mail takes 4-6 weeks. Phone (international applicants) takes 1 call during IRS hours (6am-11pm ET, Monday-Friday). 73% of EIN applications in 2024 were submitted online. The fax method accounts for most non-resident applications. ein.so uses the fax method exclusively for non-resident clients, achieving a 99.2% first-submission acceptance rate.

EIN Issuance Statistics

The IRS issued 5.1 million new EINs in fiscal year 2023 and 5.3 million in fiscal year 2024. Approximately 36 million EINs are currently active. California, Texas, Florida, and New York account for 38% of all new EIN applications. Delaware and Wyoming are the top choices for non-resident LLC formations, representing 61% of foreign-owned LLCs. The IRS processes online applications in under 5 minutes and fax applications in 4-14 business days depending on volume.

Who Needs an EIN

Any business that hires employees, operates as a partnership or corporation, files excise tax returns, or withholds taxes on income paid to a non-resident alien must have an EIN. Even sole proprietors benefit from obtaining one to protect their SSN on business forms. For a complete overview, read our guide on what an EIN is and why every business needs one.

Over 460 million SSNs have been issued since 1936. A Social Security Number (SSN) is a unique 9-digit number issued by the Social Security Administration (SSA) to US citizens, permanent residents, and certain individuals authorized to work in the United States. The SSN is the most widely used personal identifier in the US, linking you to your employment history, tax records, credit reports, and government benefits.

SSN Format and Usage

The SSN format is XXX-XX-XXXX (three digits, two digits, four digits). You use your SSN to file personal tax returns, get hired by an employer, apply for credit cards and loans, open personal bank accounts, and collect Social Security benefits. Because the SSN is connected to so many critical systems, exposing it creates serious identity theft risk. This is precisely why business owners should use an EIN rather than their SSN for business activities.

SSN Identity Theft Statistics

The FTC received 1.4 million identity theft reports in 2023, with SSN-related fraud accounting for 42% of all cases. The average victim spends 200 hours and $1,343 resolving identity theft. Businesses that use SSNs on W-9 forms, invoices, and vendor agreements expose the owner to 15-20 additional attack surfaces per year. An EIN eliminates every one of those business-related exposures. The cost of getting an EIN is $0 (IRS direct) or $49 (through ein.so for non-residents), compared to an average identity theft remediation cost of $1,343.

Non-US residents cannot obtain an SSN unless they have authorization to work in the United States. However, they can still form a US business and get an EIN without an SSN. See our guide on how to get an EIN without an SSN.

In 2023, 1.4 million Americans reported identity theft to the FTC, with total losses exceeding $10.3 billion. One of the most compelling reasons to get an EIN is privacy protection. Your SSN is the master key to your personal identity. It connects to your credit reports, bank accounts, tax history, medical records, and government benefits. Every time you share your SSN on a business form, you increase the risk that it ends up in the wrong hands.

EIN Exposure Risk vs SSN Exposure Risk

An EIN, by contrast, is a business-only identifier. If someone obtains your EIN, they cannot open personal credit accounts in your name, file personal taxes as you, or access your Social Security benefits. The damage from a leaked EIN is limited to your business entity, and even that is far more contained than SSN theft. An exposed SSN can lead to 13 types of fraud (credit card, tax, medical, employment, etc.). An exposed EIN can lead to 2 types of fraud (business credit, fraudulent tax filing), both of which are easier to detect and resolve.

IRS Recommendation for Sole Proprietors

The IRS recommends that business owners use their EIN rather than their SSN whenever possible. Sole proprietors, in particular, benefit from obtaining an EIN even when not legally required, because it removes the need to put their SSN on W-9 forms sent to every client and vendor they work with. A freelancer sending 20 W-9 forms per year exposes their SSN 20 times. With an EIN, that exposure drops to zero.

Ready to protect your SSN? Apply for your EIN today and stop sharing your Social Security Number with every business contact.