We found online guidance stating that if an individual works for themself from home, they do not need to obtain an Employer Identification Number (EIN). Is this true of a self-employed individual who is the sole owner and employee of a corporation?

No, the IRS requires corporations to obtain an EIN, and we are not aware of any exceptions for corporations owned by a sole employee who works from home.

We would caution against relying on any guidance found on non-government websites, such as irs-ein-tax-id.com, which is not affiliated with IRS.gov. However, irs-ein-tax-id.com, does note that “[e]ven if your company is based out of your home, you may need to obtain an EIN if you . . . [o]perate your company as a corporation.”

Although a company that operates as a sole proprietorship may not need an EIN (and can use its owner’s social security number), it would need an EIN if the sole proprietor has established a corporation.

For resources related to our guidance, please see:

  • IRS.gov, Do You Need an EIN? (“You will need an EIN if you answer ‘Yes’ to any of the following questions. . .  Do you operate your business as a corporation or a partnership?”)
  • irs-ein-tax-id.com, Do I need an EIN if I work from home? (Even if your company is based out of your home, you may need to obtain an EIN if you: . . . Operate your company as a corporation . . . So, as the list above details, there are clear cases when you are required to have an EIN. . . . The flip side of the equation is that, if you work for yourself and are your only employee, you are not required to get a new EIN, plain and simple. You are free to use your social security number for all of your business, banking and tax matters if you so choose.”)
  • IRS.gov, FAQs (“Does a small company that operates as a sole proprietorship need an employer identification number (EIN)? . . . A sole proprietor without employees and who doesn't file any excise or pension plan tax returns doesn't need an EIN (but can get one). In this instance, the sole proprietor uses his or her social security number (instead of an EIN) as the taxpayer identification number.”)
  • IRS.gov, Do You Need a New EIN? (“Sole Proprietors: You will be required to obtain a new EIN if any of the following statements are true. . . . You incorporate.”)