EIN for Canadian Companies: Why It’s Needed and How to Apply

Want to expand your Canadian business into the US market? You’ll need something called an EIN (Employer Identification Number) first. Think of it as a social security number for your business. It’s a unique nine-digit code that the Internal Revenue Service uses to identify your company.

Getting an EIN might sound complicated, but don’t worry. We’ve put together this guide to walk you through what an EIN is, why you need it, and how to get one for your Canadian business. You’ll learn about the application process, benefits, and potential challenges to watch out for.

📌 Quick Takeaways

• Yes, Canadian companies can get a US EIN – no US address or citizenship required.
• As an EIN for non-US residents, the application is free and can be done via phone (fastest), fax, or mail.
• Processing times vary: same-day (phone), 4 days (fax), or 4-6 weeks (mail).
• You’ll need this number for US banking, taxes, hiring, and selling on platforms like Amazon.

Can a Canadian Company Get an EIN in the US? Understanding the Basics

An EIN, which serves as the US IRS tax number for foreign businesses, is basically your business’s US ID number. While the official name is Employer Identification Number (or Federal Tax ID/TIN), it’s just a unique nine-digit code the IRS gives you. Every Canadian business doing anything in the US needs one – it’s like getting a passport for your company. The application is free, and you don’t need a US address or citizenship.

Here’s when your Canadian company needs an EIN:

1. Filing US Taxes

You need an EIN to handle your US taxes properly. If you’re running a corporation, you’ll use Form 1120-F. Solo business owner? You’ll use Form 1040-NR instead. You’ll also need forms like W8-BEN (for yourself) or W8-BEN-E (for your business) to ensure proper tax withholding. Not sure? Our US tax accountants services can help you.

2. US Banking

A US bank account requires an EIN – it’s that simple. Banks use this number to verify your business and comply with their regulations. This applies whether you’re a small online seller or a large corporation.

3. Working with US People

When hiring US employees or contractors, an EIN is required. You’ll use it for payroll taxes and to provide the right tax forms (W-2 for employees, 1099 for contractors).

4. Taking US Payments

For online sales to US customers, you need an EIN to use payment systems like PayPal or Stripe. This applies to all US platforms, including Amazon, Shopify, or eBay.

5. Getting Tax Treaty Benefits

The Canada-US tax treaty can save you money, but you need an EIN to claim these benefits. This helps avoid double taxation and reduces withholding rates on certain types of income. Explore all key tax treaty benefits available to Canadian businesses.

6. Setting Up in the US

Opening a physical location in the US requires an EIN. This includes offices, stores, or warehouses. You’ll need it for leases, permits, and local business registration.

• Read more: How to Register a Business in the US from Canada

How to Apply for a US EIN from Canada: Step-by-Step Guide

Want to get an EIN in the US for your Canadian company? It’s simpler than you might think. Let’s break it down into clear steps.

Step 1: Gather Your Information

Before you apply for your EIN, grab all the documents you’ll need. This will save time and make things easier.

What You’ll Need About Your Business

Let’s start with the basics – how your business appears on paper. You’ll need three key pieces of information:

1. Your official registered company name – the one on your legal papers
2. Any other names you use for business (we call these DBAs)
3. Your regular address in Canada – yes, that’s perfectly fine to use

Who’s Taking Charge?

Your EIN needs a point person who can make decisions for your business – usually an owner or manager. This person will be your official contact with the IRS. They’ll need to provide their full legal name. Having a U.S. social security number or ITIN helps, but it’s not required for Canadian companies.

How Your Business is Set Up

The IRS needs to know the structure of your business. Here are the key details they’re looking for:

• Your entity type (like LLC, corporation, or partnership)
• What you do (such as online retail, consulting, or manufacturing)

What’s Your Future Plan?

Be clear about why you need an EIN. Are you opening a U.S. bank account? Selling on Amazon? Let the IRS know your plans. If you’re thinking about hiring U.S. workers, give them a rough idea of how many – it’s just an estimate and can change later.

• Pro Tip: Take a moment to check all these details against your business papers. Getting it right now saves headaches later.

Step 2: Choose Your Application Method

There are several ways to get your EIN, and the best method depends on your timeline. Here’s a complete overview of all available options:

Method	Processing Time	Best For	Contact Information	Note
Phone	Immediate	Urgent needs	+1 (267) 941-1099 (not toll-free)	Call 7-8 AM EST for shortest wait times; prepare for possible fax follow-up
Fax	4 business days	Standard cases	+1 (855) 215-1627	Keep fax confirmation as proof
Mail	4-6 weeks	Complex cases	IRS, Attn: EIN Operation, Cincinnati, OH 45999	Most secure but slowest option
Online	Immediate (if eligible)	Quick processing	IRS website	Only for those with U.S. SSN/ITIN

Phone Application (Best for Urgent Needs)

The phone method is perfect for urgent cases. Call the IRS at +1 (267) 941-1099 during business hours to get your EIN immediately during the call. The best time to call is between 7-8 AM EST when wait times are shorter.

• Pro Tip: This isn’t a toll-free number, and the IRS might request follow-up documents by fax after your call.

Fax Application (Most Common Method)

Most Canadian businesses choose this method. Send your Form SS-4 to +1 (855) 215-1627, and expect your EIN within 4 business days. Also keep your fax confirmation as proof of submission.

Mail Application (Best for Complex Cases)

Sometimes you’ll have extra papers to send with your application. For these cases, mail everything to:

Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999

The mail takes longer (about 4-6 weeks), but it’s a reliable way to send all your documents together.

Online Application (Limited Availability)

You can get your EIN online right away, but you’ll need a U.S. Social Security Number (SSN) or Tax ID Number (ITIN). Since most Canadian companies don’t have these, you’ll probably need to use the phone, fax, or mail options.

Step 3: Completing IRS Form SS-4

Now it’s time to fill out Form SS-4 to get your EIN. Let’s go through the main parts you need to know.

• Download the official Form SS-4 here. Also you can visit the IRS website if you are looking for more information.

Line 7a-b (SSN/ITIN)

Don’t worry about this section if you’re a Canadian company. Learning how to get an EIN without an SSN is simple. You can leave it empty since you don’t need a Social Security Number.

Line 9a (Type of Entity)

This part is important because it determines how you’ll pay taxes in the U.S. Most Canadian companies pick one of these:

• LLC (Limited Liability Company): Great for online businesses because it’s flexible.
• Corporation (C-Corp or S-Corp): Best for service companies or businesses that want to grow big.
• Partnership: Good when you run a business with others.

Let me show you what each business type means for your taxes, including US LLC Canadian tax filing requirements:

Business Type	Who It’s For	Tax Rules	Common Uses	Tax Form	Extra Info
LLC	Online sellers, small businesses	Can choose how to be taxed	Online stores, startups	Form 1120	Use 1120 if taxed as corporation, 1065 if partnership
Corporation	Big companies, service firms	Pays its own taxes	Large businesses, professional work	Form 1120	All U.S. corporations use this
Sole Owner	One-person businesses	Owner pays taxes personally	Freelancers, small shops	Form 1040-NR	For money made in the U.S.
Partnership	Business with partners	Partners share tax duties	Family businesses, team ventures	Form 1065	Required when you have partners

Take your time choosing your business type – it affects how much tax you’ll pay and your legal responsibilities. If you’re incorporating as an LLC or corporation, our US business incorporation specialists can guide you through the process.

Line 10 (Reason for Applying)

Tell the IRS exactly why you need an EIN – whether you’re opening a U.S. bank account, hiring American workers, or starting to sell on platforms like Amazon USA. Keep your explanation clear and brief. A simple sentence stating your main reason will help process your application faster.

Step 4: Submit Your Application and Wait for Your EIN

Once you’ve completed your Canadian Corporation EIN application, submit it through your chosen method:

1. Phone: You’ll get your EIN right away
2. Fax: Expect your EIN in 4 business days
3. Mail: Wait time is 4-6 weeks, so plan ahead

Once you send everything in, make sure to keep your EIN letter safe. You’ll need this paper a lot – for doing taxes, setting up a bank account, and accepting payments from customers.

When you get your EIN letter, make a few copies and keep them in different places. You can store one on your computer or in cloud storage, another in a safe at home, or share one with your tax person.

This way, you’ll always have your EIN handy when you need it, and you won’t have to worry if you misplace the original letter.

Next Steps After EIN Approval for Canadian Businesses

Now that you have your EIN, you can open U.S. bank accounts to handle your money. You’ll need to file some tax forms too – Form 1120-F if you run a corporation, or Form 1040-NR if you’re a solo business owner. Want to hire people? Make sure to set up payroll taxes. Also, check the rules in each state where you do business. They all have different requirements for sales tax and hiring.

• Read more: How to Report Canadian Income on a US Tax Return

Key Benefits of US Tax ID for Canadian Companies

An EIN gives Canadian businesses key benefits when entering the U.S. market. Here’s why it matters:

Makes Business Simple

A U.S. EIN makes life easier for your business. You can open a U.S. bank account and keep your business money separate from personal funds. This keeps things clean and makes taxes less of a headache. It also helps you build credit in the U.S., so you can get loans or other funding to grow your business.

Helps You Hire in the U.S.

If you’re hiring U.S. employees, you’ll need an EIN. It’s your ID with the IRS for handling payroll and taxes. This number keeps things legal when paying your team and dealing with taxes. Without it, hiring gets tricky.

Saves on Taxes

An EIN can save you money on taxes. Thanks to the Canada-U.S. tax treaty, you might pay less or avoid some U.S. taxes on certain income. It also keeps your business on track with taxes, so you skip fines.

Adds Credibility

An EIN makes your business look more legit to U.S. clients, vendors, and partners. It shows you’re serious and trustworthy. If you do cross-border deals, an EIN is a must. Our cross-border accounting specialists can help smooth out customs and tax rules for better operations.

EIN for Canadian Businesses: Challenges & Pitfalls

Got your EIN approved? Great. But watch out for these common hurdles that can trip up Canadian businesses when using their new US tax ID.

1. Wrong Business Classification

Picking the right business type on your EIN form is tricky. Let’s say you run a small online shop. You might think registering as a C-Corporation sounds fancy, but an LLC could save you money on taxes. Get this wrong, and you’ll end up paying more taxes than you need to. Not sure which to pick? Talk to our tax expert who knows both US and Canadian rules.

Case Study: Fixing Mike’s EIN Application

The Problem: Mike, a consultant from Canada, applied for an EIN to work with U.S. clients. But he made a mistake. He listed himself as an employee on payroll, which triggered unnecessary tax filings like Form 940 and Form 944. The problem? He didn’t even have a payroll in place.

What We Did: In my experience, it’s best to keep EIN applications simple. Since Mike didn’t need payroll, I helped him clarify the mistake with the IRS. We explained he was the only person in the business, and no payroll setup was required. This stopped extra filings from piling up.

The Result: Mike avoided unnecessary payroll tax forms and saved valuable time and money. His business is now compliant, and he’s free to focus on consulting instead of dealing with paperwork headaches.

2. Payment Processing Holdups

Want to accept US payments? You’ll need more than just an EIN. Payment processors need to see your EIN and a W-8BEN-E form. Without these, your account could get frozen, blocking your ability to receive payments.

Case Study: How Sarah Got Her EIN Fast

The Problem: Sarah, a Canadian entrepreneur, was ready to expand her online store into the U.S. She needed an EIN to open a U.S. bank account and get started on Amazon. She applied by fax but waited weeks without any updates. Her plans were stuck.

What We Did: In my experience, waiting on a faxed EIN can take forever. I suggested Sarah call the IRS directly at +1 (267) 941-1099. By calling early in the morning, she got her EIN instantly. No unnecessary delays.

The Result: With her EIN in hand, Sarah opened her U.S. bank account, registered on Amazon, and was selling in no time. Her expansion went forward smoothly without any more setbacks.

3. Missing State Requirements

Here’s a surprise – your EIN only works for federal stuff. Each state has its own rules too. You’ll need extra permits and paperwork if you sell stuff online, hire US workers or open a US shop. Check what each state needs before you start doing business there.

• Read more: “How to Open a Business in Florida as a Canadian”

4. Documentation Gaps

The IRS is quick to reject incomplete applications. Make sure you have:

• Your Canadian company papers
• Your CRA business number
• Your ID
• Proof of your Canadian address

 Save digital copies of everything. You’ll need them again for banks and payments.

5. Bank Account Setup

US banks have strict requirements for Canadian businesses, even with an EIN. Most need extra documentation and minimum deposits. Look for banks experienced with Canadian business accounts to make the process smoother.

• Pro Tip: Check out TD Bank or RBC US – they’re used to working with Canadian businesses and might make things easier.

Remember, these bumps in the road are normal when expanding to the US. Most businesses face them. Need help? We’ve guided hundreds of Canadian companies through this exact process.

Frequently Asked Questions About EIN for Canadian Businesses

Final Thoughts

Getting an EIN opens doors to the US market. This nine-digit number lets you open US bank accounts, hire employees, process payments, and handle your taxes right. While the process has its steps, it's totally doable with good planning.

Need help with your US expansion? At SAL Accounting, we've guided hundreds of Canadian businesses through their EIN and tax journey. Contact us now, we'll make sure you're set up right from day one.