EIN vs. ITIN: What International Business Owners Need to Know

Starting a business in the United States as a non-resident entrepreneur can be exciting—but also a bit confusing, especially when it comes to the paperwork. One of the most common points of confusion for international business owners is the difference between an EIN (Employer Identification Number) and an ITIN (Individual Taxpayer Identification Number).

If you’re not sure which one you need—or if you need both—this guide is for you.

🔍 What Is an EIN?

An EIN (Employer Identification Number) is a tax ID number issued by the Internal Revenue Service (IRS) to identify a business entity operating in the U.S. It’s also known as a Federal Tax Identification Number.

✅ Who Needs an EIN?

• LLCs or corporations formed in the U.S.
• Businesses with employees
• Businesses required to file excise, employment, or alcohol/tobacco/firearms tax returns
• Partnerships
• Any U.S. company that needs to open a U.S. business bank account

For international founders, an EIN is crucial for:

• Registering your business
• Opening a U.S. bank account
• Setting up payment gateways like Stripe or PayPal
• Filing U.S. tax returns for your LLC

🔍 What Is an ITIN?

An ITIN (Individual Taxpayer Identification Number) is a personal tax ID number issued by the IRS to individuals who need to pay U.S. taxes but aren’t eligible for a Social Security Number (SSN).

✅ Who Needs an ITIN?

• Non-resident individuals earning U.S. income (such as Amazon sellers or freelancers)
• Business owners needing to comply with tax reporting
• Individuals listed as members or owners of a U.S. LLC
• People applying for tax treaty benefits (to avoid double taxation)

Note: An ITIN is not a business number. It’s used for personal tax identification only.

🆚 Key Differences Between EIN and ITIN

🌎 Do International Business Owners Need Both?

It depends.

• If you are owning or managing a U.S. LLC: You need an EIN for your business operations.
• If the IRS needs to associate your individual identity with tax documents (like when claiming tax treaties or filing Form W-8BEN), you may also need an ITIN.

Some situations where you might need both:

• You are the sole member of a U.S. LLC and plan to file tax returns
• You want to open a U.S. bank account and the bank requires proof of your U.S. tax ID
• You plan to withdraw profits and avoid double taxation under a U.S. tax treaty

✅ Final Thoughts

If you’re planning to launch a U.S.-based business as an international entrepreneur, understanding the difference between EIN and ITIN is crucial for compliance and smooth operations.

At Laplif Digital Limited, we help non-residents:

• Register their U.S. LLC
• Apply for EIN and ITIN
• Open U.S. business bank accounts
• Stay compliant with U.S. tax regulations

Need help deciding whether you need an EIN, ITIN, or both?
👉 Contact us today at laplifdigital@gmail.com or visit laplifdigitallimited.com