An employer identification number (EIN) is a nine-digit number the IRS uses to identify a taxpayer. After a death, the estate becomes its own taxpayer, so executors typically request an EIN for the estate rather than using the deceased's Social Security number.
If you've been named an executor, you're working through a long list of unfamiliar tasks while you're still grieving. Then the bank adds one more: before it opens an estate account, it needs a tax ID number, an EIN.
An employer identification number is a nine-digit number the IRS uses to identify a taxpayer. The estate needs its own, and getting one is usually simpler than it sounds. It's one of the first steps in settling an estate.
When someone dies, the IRS stops treating their finances as personal and more like an entity. The estate, meaning the money and property the person left behind, becomes a separate taxpayer with its own responsibilities. That's why the estate generally can't keep using the Social Security number of the person who died (the IRS calls this person the decedent on its forms).
According to Michael Fiffik, Managing Partner, Fiffik Law Group:
It is customary to open a bank account in the name of the decedent’s estate as part of the administration of a probate estate. The bank will not open the account without an EIN for the estate.
The estate’s EIN becomes the way that the estate identifies itself. Banks generally ask for an EIN for an estate account before they agree to open one. The number also appears on returns filed using Form 1041.
Whether your court papers call you an executor, an administrator, or a personal representative, settling an estate with a Will comes with real legal responsibilities. With a LegalShield® Personal Plan, you can bring your questions to a provider law firm as you work through the estate.
The application goes quickly if you gather a few details first, and most executors have these on hand already:
Most executors apply for an EIN through the IRS online application, which is available during weekday hours. The IRS doesn't charge anything when you apply directly. Applicants typically encounter a few questions along the way: who the EIN is for (estates have their own category), and the details you gathered above.
Online applicants can download the confirmation letter (CP 575) as soon as the application is processed. If that letter is misplaced later, the IRS can issue a replacement known as an EIN verification letter (147C).
Applying online isn't the only path, either. Executors can also file Form SS-4 by fax, which typically takes about four business days, or by mail, which can take several weeks.
The IRS requires the responsible party to be a natural person, not a company. For an estate, that means the executor, administrator, or personal representative must be listed on the EIN application by name. A law firm or other organization can't fill that role.
That said, you don't have to click through the application yourself. A third party, such as an accountant, can be authorized as a designee to submit it on your behalf. You still remain the responsible party as the individual handling the estate.
That covers how to get an EIN for an estate. This is the number that is used to do estate-related business. The first stop for most executors is setting up an estate account, since banks typically ask for the EIN and often the CP 575 letter before opening one.
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Often, yes. Under IRS guidance for executors, estates generally file Form 1041, but banks require an EIN before opening an estate account, whether or not there is income. Even a small, simple estate usually ends up needing the number.
No, the IRS doesn't charge for an EIN when you apply directly, whether online or with Form SS-4. Some third-party websites charge a service fee to submit the same application, so it's worth going straight to the source when possible.
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