If you’re a business operating in the US, chances are you need to apply for a federal Employee Identification Number (EIN). An EIN or federal tax identification number is a way to identify your business to the IRS similar to having a social security number. If you applied for an EIN online or by sending in Form SS-4, you would have received a confirmation letter – CP 575. This letter is needed by many financial institutions to open accounts, apply for business loans, and more. To give you an idea of what this looks like, here’s a sample of this letter below:
But what happens if you lose it? Unfortunately, the IRS only issues one EIN per individual and the CP 575 notice can only be generated once – it cannot be recreated. However, this is where the 147C letter comes in handy: you can request another official copy of your EIN from the IRS, just in a different format.
A 147C letter is a formal document from the IRS stating your already-existing EIN. This is why it can also be called an EIN verification letter. These letters are only issued upon the misplacement of the original CP 575 notice. Though this letter is different from CP 575, banks and other institutions will accept it as proof of your EIN because it comes from the IRS. Here’s a sample 147C letter below:
You might be wondering why an official letter from the IRS is required when you can recall your EIN from memory, or present a piece of paper with your EIN written on it. Many institutions require official documentation for security reasons, such as to prevent fraud. Here are some reasons why you need to have an official letter from the IRS.
If you want to open a bank account for your LLC, for example, you’ll need an official copy of your EIN from the IRS. The reason for this is to help prevent fraud as a business only receives one EIN, so they can use it to double-check the identity of the business owner.
Additionally, if you are looking to apply for a corporate credit card or a business loan, you will need to present a CP 575 notice or 147C letter, for the same reasons. Security is a topmost concern when finances are involved.
A 147C letter is typically needed when you are forming a partnership with a vendor or other business. Some vendors that offer payroll services or merchants, will ask for official proof of your EIN to verify your business. Specifically, Quickbooks asks its clients for official proof of their EIN before processing direct deposits to employees.
On a more practical level, presenting a formal letter from the IRS adds a level of credibility to your business that may help solidify trust with a potential business partner. In many cases, being standard with business matters is always a net positive.
According to IRS regulations, you can only request a 147C letter if you are an authorized person. This definition includes:
If you have a Power of Attorney over the owner of a business that is on file with the IRS, you can also request a 147C letter.
The only way you can request a 147C letter is by calling the IRS at 1-800-829-4933 between 7 a.m. and 7 p.m. Mon-Fri. Here are the steps to follow:
Once you have completed the above steps, you will be asked if you would prefer to receive the 147C letter by mail or by fax. If you opt for the former, you could wait up to 4-6 weeks. If the latter, the IRS will fax the document to you immediately. The IRS does not email out EIN verification letters for security reasons.
Once received, we recommend making multiple copies on file, both digitally and physically.
If you haven’t exhausted every resource before applying for a 147C letter, the IRS recommends taking the following steps if you have lost your EIN:
These steps do not necessarily give you an official copy of your EIN, just the number. You may still need to apply for an EIN verification letter if you are looking to work with a financial institution or other agents.
To conclude, having an official notice of your EIN by way of a CP 575 or 147C letter, is crucial to running your business smoothly. Though it may seem tedious to contact the IRS and potentially wait on hold, it’s worth it. Maintaining proper records is a core part of running a successful business.
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