Do I Need an EIN to Open a Business Bank Account?

Q: How much does an EIN cost for a bank account?

Nothing. The IRS issues an EIN free of charge and states you never have to pay a fee for one. You can apply online and receive the number immediately, then bring it to the bank. Third-party sites that charge for an EIN are reselling a free service.

Fact-checked by the LegalGlass editorial team against primary sources · Published Aug 6, 2026 · Last updated Aug 6, 2026

It depends on your entity. LLCs, corporations, and partnerships effectively need an EIN to open a business bank account, because the account belongs to the entity and federal law requires the bank to collect the entity's taxpayer identification number. A sole proprietor with no employees can often use a Social Security number, but most U.S. banks still ask for an EIN.

Quick Answer

LLC / corporation / partnership: Effectively yes - the account is the entity's; banks require its EIN
Sole proprietor, no employees: It depends - an SSN can qualify, but most banks ask for an EIN
Governing rule: 31 CFR 1020.220 - bank must collect a taxpayer ID at account opening
EIN cost: $0 - the IRS never charges a fee for an EIN
How to get one: IRS Form SS-4 (online, immediate)
No SSN?: A business can get an EIN with an ITIN responsible party

The Short Answer

Whether you need an EIN to open a business bank account turns on your legal structure, not on a single federal banking rule that names the EIN. An Employer Identification Number is the 9-digit federal tax ID the IRS assigns to a business or other entity. When your business is a separate legal entity - an LLC, corporation, or partnership - the bank account belongs to that entity, and the entity's taxpayer identification number is its EIN. That is why, for those structures, the answer is effectively yes.

A sole proprietorship is different, because there is no separate entity: the owner and the business are one taxpayer. For income-tax purposes a sole proprietor uses their own Social Security number, so a bank may open a business account for a sole proprietor using an SSN. Even then, many banks require an EIN as a matter of internal policy, and a sole proprietor who hires employees must obtain one anyway. For the number's definition and legal basis, see what is an EIN and the EIN glossary entry.

Why Banks Ask for a Tax ID

Banks ask for a tax ID because federal anti-money-laundering law requires it. The Customer Identification Program (CIP) rule at 31 CFR § 1020.220 requires a bank, before opening an account, to obtain at minimum the customer's name; date of birth, for an individual; address; and an identification number. For a U.S. person, that identification number is "a taxpayer identification number." The FDIC's consumer guidance likewise tells applicants to bring a Social Security number or Individual Taxpayer Identification Number when opening an account.

A "taxpayer identification number" is the umbrella term. Under 26 U.S. Code § 6109, an individual's taxpayer ID is generally a Social Security number, while a business entity's taxpayer ID is its EIN. So when the customer is an entity, the "taxpayer identification number" the CIP rule requires is an EIN - which is the mechanism that makes an EIN effectively mandatory for an LLC, corporation, or partnership account.

The CIP rule also requires the bank to verify the identity information it collects and to keep a record of it. In practice, that verification step is why the front-line request at account opening is documentary: the bank matches the tax ID to formation paperwork and photo identification. The rule sets a federal floor, and each bank layers its own Customer Identification Program on top, which is why two banks can ask a sole proprietor for different documents while both satisfy the same regulation. The number itself is not optional - only which number (SSN or EIN) a given customer type may present.

When a Sole Proprietor Can Use an SSN Instead

A sole proprietor without employees can often open a business account using a Social Security number, because the individual is the taxpayer and the account. The IRS does not require a sole proprietor with no employees and no excise-tax obligation to obtain an EIN; the owner reports business income on Schedule C using their SSN. Whether the bank accepts an SSN, however, is the bank's policy call, and policies vary widely by institution.

Reasons a sole proprietor may still choose an EIN include:

Bank policy: many banks require an EIN for any account opened under a business or "doing business as" name, even for a sole proprietor;
Privacy: using an EIN keeps the owner's SSN off vendor Form W-9 and 1099 paperwork;
Hiring: a sole proprietor who takes on employees must get an EIN to run payroll and file employment taxes;
Growth: converting to an LLC or corporation later will require an EIN, so many owners get one at the start.

Because the EIN is free and issued immediately online, the practical calculus for most sole proprietors is that obtaining one removes any doubt about the bank's policy and keeps the SSN private, at no cost. The trade-off is minimal: one application on Form SS-4 versus the risk of a wasted trip to a bank that will not open a business account on an SSN. If you expect to hire, register a DBA, or later form an LLC, getting the EIN first is the tidier path.

LLCs, Corporations, and Partnerships: Effectively Yes

For an LLC, corporation, or partnership, an EIN is effectively required to open the account. The IRS Employer Identification Number page states you need an EIN if you "operate your business as a partnership or a corporation" - so those entities already hold an EIN for tax purposes, and the bank uses that number to open the account. A multi-member LLC is treated as a partnership by default and likewise needs an EIN.

The distinction matters because the account name must match the tax ID. A corporation opens the account in the corporation's legal name, tied to the corporation's EIN; a partnership does the same under the partnership's EIN. Deposits and card payments processed through that account are reported to the IRS under the entity's EIN, so a mismatch between the account's tax ID and the entity's return is exactly what banks and the IRS are set up to avoid. That reporting logic - not a rule that says "an LLC must have an EIN to bank" - is what makes the EIN effectively unavoidable for a registered entity.

A single-member LLC is the nuance. For income tax, the IRS Single Member Limited Liability Companies page treats it as a disregarded entity that "generally must use the owner's social security number (SSN) or employer identification number (EIN)." But because the bank account is opened in the LLC's legal name, banks generally require the LLC's own EIN rather than the member's SSN. Getting one is straightforward - see how to get an EIN for an LLC and single-member LLC.

What Banks Typically Ask For

Banks typically ask for the tax ID plus formation and identity documents, and the exact list depends on your structure. The CFPB's checklist for opening an account and the FDIC's account-opening guidance both list government photo ID and a taxpayer identification number as core requirements. The table summarizes the tax ID a bank generally expects by entity type.

Entity type	Tax ID the bank generally expects	EIN effectively required?
Sole proprietor, no employees	SSN or EIN (bank's policy)	Often, by policy
Sole proprietor with employees	EIN	Yes
Single-member LLC	EIN (in the LLC's name)	Yes, in practice
Multi-member LLC	EIN	Yes
Partnership	EIN	Yes
Corporation (C or S)	EIN	Yes

Beyond the tax ID, banks commonly request government-issued photo identification, the business formation documents (articles of organization or incorporation), any DBA registration, and an operating agreement or corporate resolution authorizing the account. Requirements differ by institution, so confirm the exact list with your bank before you go.

What to Do Next

If you need an EIN, get one directly from the IRS for free before you visit the bank. The IRS Get an Employer Identification Number page states, "You never have to pay a fee for an EIN," and the online application issues the number immediately, subject to a limit of one EIN per responsible party per day. You apply on Form SS-4, which is the "Application for Employer Identification Number." Our step-by-step guide, how to get an EIN, walks through the application, and how to form an LLC shows where the bank account fits in the overall sequence.

If You Don't Have an SSN

You can still open a business account without a Social Security number by using the entity's EIN. A business can obtain an EIN even when its responsible party is a non-resident who has an ITIN rather than an SSN, and the account is then opened under the entity's EIN. The responsible party on Form SS-4 may identify with an SSN, an ITIN, or an existing EIN. For details, see can you get an EIN without an SSN? Individual customers who lack an SSN may open personal accounts with an ITIN, and the taxpayer-ID options are set by what is an ITIN. Confirm accepted identification with the specific bank, because documentation policies vary.

Risks of Using the Wrong Number

Using the wrong tax ID on a business account creates matching problems, not legal penalties in most cases. If an entity account is opened under an owner's SSN instead of the entity's EIN, the income reported to the IRS may not match the entity's return, which can trigger notices. Running business income through a personal account can also weaken the liability separation an LLC or corporation is meant to provide, because commingling funds is a factor courts weigh when deciding whether to disregard an entity's limited-liability shield. Opening the account under the correct entity EIN from the outset avoids both the reporting mismatch and the commingling problem.

This page is general information, not legal or tax advice, and it does not tell you which account or number is right for your specific business - that turns on your facts and your bank's policies. It explains the governing federal rule and points to the primary IRS, FDIC, and CFPB sources so you can confirm your own situation. For tax-filing obligations tied to your EIN, see business tax.

How to get an EIN - apply step by step.
What is an EIN? - definition and legal basis.
Can you get an EIN without an SSN?
How to form an LLC - where the bank account fits.
Single-member LLC - disregarded-entity basics.
EIN (glossary) - the one-line definition.
What is an ITIN? - the individual taxpayer ID.
Business tax - filing obligations tied to your EIN.

Frequently Asked Questions

Can a sole proprietor open a business bank account with just an SSN?

Sometimes. A sole proprietor with no employees is the individual customer, so federal law lets the bank collect an SSN instead of an EIN. In practice, most U.S. banks ask a business account for an EIN, so many sole proprietors get one anyway.

Does an LLC need an EIN for a bank account?

Effectively yes. The account belongs to the LLC, and banks require the entity's taxpayer ID, which for an LLC is an EIN. Even a single-member LLC that could use the owner's SSN for taxes generally needs an EIN to open the account in the LLC's name.

Why does the bank ask for a tax ID at all?

Federal Customer Identification Program rules in 31 CFR 1020.220 require a bank to obtain a name, date of birth for an individual, address, and identification number before opening an account. For a U.S. person, that number is a taxpayer identification number.

How much does an EIN cost for a bank account?

Nothing. The IRS issues an EIN free and states you never have to pay a fee for one. You can apply online and receive the number immediately, then bring it to the bank. Sites that charge for an EIN are reselling a free service.

Can I open a business account without a Social Security number?

Often yes, through the entity. A business can obtain an EIN even if its responsible party has an ITIN rather than an SSN, and the account is opened under the entity's EIN. Requirements vary by bank, so confirm accepted identification.

Sources

Cornell Legal Information Institute - 31 CFR § 1020.220 (CIP: name, DOB, address, identification number; for a U.S. person a taxpayer identification number).
Cornell Legal Information Institute - 26 U.S. Code § 6109, Identifying numbers (SSN for individuals; EIN for entities).
IRS - Employer Identification Number (need an EIN if you operate as a partnership or corporation).
IRS - Single Member Limited Liability Companies (disregarded entity uses owner's SSN or EIN; must use EIN with employees/excise tax).
IRS - Get an Employer Identification Number ("You never have to pay a fee for an EIN"; issued immediately; 1 per responsible party per day).
IRS - About Form SS-4 (Application for Employer Identification Number).
IRS - Responsible parties and nominees (responsible party may use an SSN, ITIN, or EIN).
IRS - About Form W-9 (payee furnishes its taxpayer identification number).
FDIC - How to Open a Bank Account (bring a Social Security number or ITIN and photo ID).
FDIC - Collecting Identifying Information Under the CIP Rule (TIN required from a U.S. person prior to account opening).
CFPB - Checklist for Opening a Bank or Credit Union Account (identification and identifying-number requirements).
CFPB - Why am I asked for personal information? (SSN, taxpayer identification number, or other ID number).

LegalGlass provides general information for educational purposes and is not a law firm or a substitute for advice from a licensed attorney or tax professional. This page is information, not advice. Bank policies and federal rules change; verify current requirements with your bank, the IRS, and the FDIC before acting.