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Daniel Gray CPA Toronto

EIN (IRS TAX ID) tips


Just got an EIN? Note that sometimes the party to whom you provide the number will use a third party service to electronically validate that number and since this number is brand new, it cannot be validated by that third party service for two-three weeks’ time (it still can be used immediately). Thus, be sure to mention it being a new number to any party to which you provide this EIN, so as to prevent a scenario where they attempt to validate and because it’s new and can’t be validated just yet, they think it’s void. Said another way, it will take up to two-three weeks before your EIN becomes part of the IRS's permanent records. You must wait until this occurs before you can pass an IRS Taxpayer Identification Number (TIN) matching program. (e-filing returns using the newly issued EIN won't work for two weeks for same reason and will get a mismatch name-TIN reject code).

Your EIN number belongs to you and will never change. Even if you don’t file federal taxes said EIN is never allotted to another party as IRS does not cancel an EIN.

IRS, on official IRS letterhead, should mail out a confirmation of this number in the next four weeks (and of course - compare the letter’s number and entity name listed to the one IRS orally (or by fax) said it issued you, as IRS mistakes happen). You should retain said letter in your permanent files and you may give a copy of this document to anyone asking for proof of your EIN. Don’t lose it – every so often individuals and/or companies tell me that customers or suppliers request a copy of that original IRS letter as proof of the EIN and meanwhile over the years they misplace the letter and can’t locate it.


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