Business License vs EIN: Do You Need Both?
Last updated September 24, 2026 · Written by the EIN Registration filing team
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| EIN | Business license | |
|---|---|---|
| Issued by | The IRS | Your city or county, and in some states the state as well |
| What it is for | Identifying the business to the IRS on tax returns, payroll, bank accounts and W-9s | Permission to operate a business in that place |
| Cost | The IRS charges nothing for it | Set locally, and it varies |
| Renewal | Never. It is the business's number for life | Usually renewed on a cycle the licensing office sets |
| One per | Taxpayer: one LLC or corporation, or one sole proprietor | Often one per location or per kind of activity |
Which one comes first
For an LLC or corporation, the order is the state formation filing, then the EIN, then licenses and state tax accounts. The IRS wants the entity’s legal name and formation date as the state recorded them, so the EIN waits for the formation. Licensing and tax registration offices then ask for the EIN, so they wait for it. Why the EIN waits for the LLC.
A sole proprietor has no formation step. They can get an EIN whenever they like, and many do so before applying for a local license simply to keep their Social Security number off the forms.
States that license at the state level
Most licensing is local, but a few states run a statewide license or registration that nearly every business needs, and their applications ask for the EIN. Examples from the states we cover:
- Alaska requires an Alaska Business License to engage in business in the state at all.
- Washington issues its state business license through the Department of Revenue’s Business Licensing Service.
- Nevada has a state business license, renewed each year with the Secretary of State.
- West Virginia requires a Business Registration Certificate from the Tax Division for nearly every business.
Others have no general state license and leave it to cities and counties, such as Illinois, North Carolina and Wyoming. Each state page covers what that state asks for once you have the EIN.
Things that are neither
A DBA registration is not a license and not a tax number; it only records a trade name. A DBA and the EIN. A state sales tax permit or employer account is a state tax registration, separate from both. State tax ID vs federal EIN.
Quick answers
Is an EIN a business license?
No. An EIN identifies the business for federal tax purposes. It gives no permission to operate anywhere.
Does a business license give me an EIN?
No. The licensing office does not issue federal tax numbers. The EIN comes only from the IRS, on Form SS-4.
Can I get a business license without an EIN?
Sometimes, for a sole proprietor using their Social Security number, but an LLC with employees or more than one member must have an EIN anyway, and many license and tax applications ask for it. Do you need an EIN?
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Related guides
- State Tax ID vs Federal EIN: What Is the Difference? The EIN comes from the IRS and is one number per business. State tax IDs come from your state's revenue agency, there can be several, and you usually need the EIN first. Which is which on a W-2, a bank form and a sales tax permit.
- What Is an EIN Used For? (And Who Needs One) The 7 things an EIN unlocks, who the IRS actually requires to have one, and when an SSN is enough.
- Do I Need an EIN? (Every Situation, Answered) Banks require one in almost every case and the IRS requires one in six. Single-member LLC, sole proprietor, DBA, no employees, contractor, rental property, and the bank account question, each answered plainly.
- Can You Get an EIN for a DBA? A DBA is a name, not an entity, so the EIN belongs to whoever is behind it. What that means for a sole proprietor and for an LLC with several trade names, and the mistake that leaves a DBA with two numbers.
- Does an LLC Need an EIN? When It Is Required and When It Is Not Required for multi-member LLCs, LLCs with employees, and S or C elections. A single-member LLC with no employees can use the owner's SSN for federal tax, but the bank, payment processors and W-9s make the EIN the practical answer. EIN vs SSN, form by form.
EIN Registration is an independent document preparation and filing service and is not affiliated with the IRS or any government agency. You can also apply for an EIN directly with the IRS at irs.gov at no cost.