Amazon is arguably one of the largest e-commerce marketplaces in the world. Therefore, it is host to an unfathomable number of businesses, and Amazon needs to know your EIN before they let you become a vendor.
What exactly is the EIN number?
EIN stands for Employee Identification Number and is a 9-digit number explicitly granted for businesses of all kinds as an ID card for their financial matters. The most common utility that EIN satisfies is providing a tax identity.
Just like you need a Social Security Number to file personal taxes, you need an Employee Identification Number to file taxes for your business. This federal tax identification number is a necessity for most Amazon sellers and can be managed via the Amazon account.
What is your Amazon Employer Identification number?
An Employee Identification Number, also known as a Federal Tax Identification Number, is a part of the identification system of the US government. It is used to identify a business entity.
The IRS runs a tight ship and is responsible for giving out this tax ID to businesses. These numbers are handed once for each company. They neither expire nor are they reissued for other enterprises.
The Internal Revenue Service generates EINs for all kinds of business and for free. The only two conditions for getting your hands on an EIN are that the company must be located in the US and that the person applying for the EIN must have personal tax identification like a Social Security Number.
Step by step guide on acquiring the EIN
Amazon dishes out a special Employer Identification Number for each of its registered vendors. You can manage this via your Amazon account. Therefore, all Amazon retailers must acquire their Employee Identification Number.
How To Apply for EIN via the Internal Revenue Service?
The basic steps are as follows. As we said, your business should be based in the US, must have a mailing address, and the owner must have some kind of identification.
- You can apply online for the EIN from the IRS website
- On the next page, you have to read the instructions and accept the conditions
- Now, you can provide the necessary information about your organization
- The IRS website may ask a few more questions
- After this, you will receive the EIN immediately along with the necessary documents
In case of disparities, you may need to attend a tax interview with the IRS.
How To Take Care of Your EIN?
The EIN given to your business by the IRS is the one that you can use to become an eligible vendor on Amazon. If you have misplaced this number, then you need to contact the IRS with all necessary paperwork for another copy of the same document.
Your bank and Amazon seller account will have your EIN registered with them, but they can refuse to share the same with you for these very security reasons.
Why Does Amazon Need Employer Identification Number — EIN?
Amazon needs your Employer Identification Number to register you as a vendor to prevent any business malpractice. This preventive measure is taken so that vendors cannot hold multiple Amazon accounts; you can only have one EIN for every vendor.
Additionally, Amazon itself as a business has to report its financial data to the Internal Revenue Service (IRS) every year. This data is essentially a cumulation of the financial dealings of all Amazon vendors.
Amazon has a robust service center built to cater to all the needs of the vendor. They will guide you swiftly through the entire process of applying to become a vendor. However, you will need an IRS-approved EIN before you begin this task.
Why do you need an EIN number?
Businesses use their EINs to pay their federal taxes online, file their tax returns, and regulate payroll and tax documents to suppliers. An EIN is a stamp that gives legitimacy to any business and allows it to enter the market.
The primary function of an EIN is taxation. It is the gateway, a permit, that allows businesses to navigate through the US Taxation system.
Common Needs of an EIN
To register a bank account for your business entity, you would need an Employer Identification Number — EIN. If you seek financial investments for the company, then an EIN would prove to investors that your business is legitimate, authentic, and does not mean performing any malicious activity. It is a business version of the individual taxpayer identification number
Whenever you have to handle payroll for your employees, you will need an EIN. The IRS will use the EIN to track all your payroll advances for your business or company. You may have only one employee in your business, i.e., yourself, but you will need an EIN for that. The income tax and payroll tax remittances of your business will be calculated using your EIN.
What if I am based outside the US?
EIN is a tool used by the Internal Revenue System of the USA. It is a nationalized function that enables the government to keep a track record of all legitimate businesses in all of the country’s land. However, you might need to have an EIN if you are looking to become a vendor in the US while living in some other country.
This grey area is found when you are looking to engage with customers on online markets like Amazon. For instance, Amazon UK sellers may want to expand their territory.
As a seller on Amazon, you will need to provide them with some tax identity. Since you are probably not a US citizen, you will not have a social security number to your name. However, there are ways in which you can obtain an EIN for your business not based in the US.
How to Get EIN If You Are Outside the US?
The first step for doing so is securing a mailing address within the US. You can either have a business rep in the US do this for you or purchase the services of certain mailing companies that will hold your goods for you and mail them to you whenever you wish.
The next step is contacting the IRS, filling out the necessary paperwork, and applying for an EIN on your procured mailing address. It takes roughly 30 days for the IRS to mail you a copy of your EIN, so hold your horses till then. In some cases, it may take a few weeks extra.
The IRS specially handles foreign EINs, so make sure you contact the right people there and use a valid mailing address. It might seem a daunting process to seek an American EIN if you aren’t based in the US, but be rest assured that the IRS works for your benefit to do business in the States.