What is a Fed ID?
A Fed ID, also known as a Federal Employer Identification Number (FEIN) or Employer Identification Number (EIN), is a unique nine-digit number the IRS assigns to businesses for tax reporting purposes. It acts like a company's Social Security Number (SSN), helping the IRS track tax obligations.
You’ll need a Fed ID if your business has employees, operates as a corporation or partnership, or files certain tax returns. Collaborate with Homebase payroll to manage your business legally and ensure proper payroll handling.
Why businesses need a Fed ID
A Fed ID is required for several key business operations, including:
- Hiring employees – Needed to report wages and payroll taxes to the IRS.
- Filing federal and state taxes – Used when submitting business tax returns.
- Opening a business bank account – Most banks require an EIN.
- Applying for business licenses and permits – Many local and state agencies require a Fed ID.
- Issuing tax documents – Employers must include their EIN on W-2s and 1099s.
Businesses may face compliance issues and tax processing delays without a Fed ID.
How to apply for a Fed ID
Applying for a Fed ID is free and can be done through the IRS in a few ways:
- Online – The fastest and easiest method via the IRS EIN application page.
- By mail or fax – Using Form SS-4, though processing can take a few weeks.
- By phone – Available for international applicants only.
Once assigned, your EIN stays with your business for life unless there is a significant change in ownership or structure.
How to find your Fed ID if you’ve lost it
If you’ve already obtained an EIN but can’t find it, you can:
- Check your IRS confirmation letter (received when applying).
- Look at previous tax returns or business bank account records.
- Contact the IRS Business & Specialty Tax Line for assistance.
How your Fed ID affects payroll
Employers must use their Fed ID for payroll-related activities such as:
- Withholding and remitting payroll taxes to the IRS.
- Filing employment tax forms like Form 941 (quarterly tax returns) and Form W-2.
- Ensuring compliance with federal and state payroll tax regulations.
Handling payroll taxes manually can be overwhelming, but you don’t have to do it alone. Homebase payroll automates tax calculations, filings, and compliance—helping you stay on track with less effort.
Make payroll and tax compliance easy with Homebase
Keeping track of tax obligations and compliance deadlines can be challenging, but Homebase payroll makes it easy. With Homebase, you can:
- Ensure correct EIN usage for payroll tax filings
- Automate federal and state tax withholdings to avoid IRS penalties
- File payroll tax forms accurately and on time
- Maintain organized tax records for compliance and audits
Get started with Homebase today and take the stress out of payroll and tax management.
Related articles
- Run Payroll: Successfully Run Payroll in 6 Steps
- What is a W9 Form? Everything You Need to Know
- New employee forms for your onboarding process