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Taxpayer ID Number

xiaohuaz by xiaohuaz
Last updated: 11/05/2011

Your Own Free Tax ID Number

Are you using your Social Security number as your Taxpayer ID Number? Are you an aspiring Internet affiliate marketer? Do you do business on line? If so, you may be exposing yourself to the risk of identity theft. Would you give your home address to a stranger? Of course not, because it exposes you to risk. Giving your Social Security number (SSN) to strangers is even riskier, yet people do it all the time. Why? Because many affiliate programs ask for your Federal Taxpayer ID number when you sign up, and most people use their SSN as their tax id number. Luckily, this risk is easy to eliminate. While it's true there needs to be some way to identify you for tax purposes, you don't need to give out your SSN. You can get an alternate Taxpayer ID Number from the IRS - for free - and this page will tell you how to do it.

What is a Taxpayer ID Number?

Your Federal Tax ID number is a number used by the Internal Revenue Service (IRS) in the administration of tax laws. It is issued either by the Social Security Administration (SSA) or by the IRS. The Taxpayer ID number (TIN) issued by the SSA is your Social Security number (SSN). All other TINs are issued by the IRS. Since most individuals are not considered business entities, they simply use their SSN as their Taxpayer ID number. Because of the prevalence of identity theft, this is a bad idea.

According to the SSA, identity theft is one of the fastest growing crimes in the United States. One method used by identity thieves to steal personal information is through unsecured Internet sites. This information can then be used by the thieves to obtain employment, housing, and credit in your name. Then they don't pay the bills and your credit is destroyed. There could even be civil judgments or an arrest warrant issued against you in extreme cases.

The way to avoid this risk is simple. When you sign up for affiliate programs, they will ask you for a Federal Tax ID number. Instead of using your SSN as your Taxpayer ID number, you should use an Employer Identification Number (EIN) issued to you for free by the Internal Revenue Service. Using the EIN will help eliminate the chance that identity thieves can use an unsecured web connection or other methods to steal your personal information.

Whatever You Do, DON'T Pay for a Tax ID Number

Don't PAY for a FREE Tax ID number!!!

SCAM ALERT!!!

If you Google "Employee Identification Number," you will find many companies offering to help you get an EIN for a "low" or "affordable" price. Do not pay. These outfits are a ripoff. You can get an EIN yourself for free at the IRS web site.

How Do I Get a Tax ID Number?

You get your Tax ID Number - free - from the IRS

The first thing you need to do is go to the IRS web site and download Publication #1635, Understanding Your EIN. This is confusing to some people because the IRS uses the term Employer Identification Number (EIN) to refer to your Taxpayer ID number. When you apply for an EIN, the EIN is your taxpayer ID number even if you're not an employer. This booklet will tell you everything you need to know about your EIN (aka Tax ID number). The one decision you'll have to make is, what type of business entity do you want to be? I chose "Sole Proprietorship." The other options can cost extra money and paperwork hassles, so as long as you don't have employees, "Sole Proprietorship" might work for you as well.

How To Get a Tax ID Number

Apply for Federal Tax ID number online for free...

Applying for a Tax ID number is easy to do online and it's free. Once you decide what type of business entity you want to be go to the IRS's on line application form and apply for a Federal Tax ID number (if the link stops working you can go to the main IRS web site and type EIN into the search box). It only takes a few minutes and you get your new Taxpayer ID number instantly. It's really that simple, and yes it's really free. There are a few things to be careful of though:
  • Make sure you fill out your information exactly as it appears on your Federal tax return.
  • Make sure to print out a copy of your notification. The IRS won't be mailing you one.
  • Even though they give you your EIN instantly, it can take up to 2 weeks for it to be entered into their system.
  • If you don't fell comfortable applying on line, you can also apply by phone or snail mail, but it will take you up to 2 weeks to get your EIN.

Your Free Tax ID Number

That's really all there is to it!

Wasn't that easy? Now that you have your free Tax ID number aren't you glad you didn't pay some scam artist to apply for you? Now you don't have to give out your SSN when signing up for affiliate programs or on line job opportunities. I hope you find this a simple, useful way to help protect yourself from identity theft while on line.

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This UpMarket page written by

xiaohuaz

If you earn money with affiliate programs, you need to get a Taxpayer ID Number to help protect yourself against identity theft. It's easy, it really is... more »

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