If you’re getting ready to launch a business, you may be wondering:
“Should I get an EIN or form my LLC first?”
It’s a common question for new entrepreneurs — and the order matters.
In this article, we’ll explain the difference between an EIN and an LLC, why the LLC should always come first, and what happens if you do it in the wrong order.
🧾 What Is an EIN?
An EIN (Employer Identification Number) is a unique 9-digit number issued by the IRS. It’s like a Social Security Number for your business and is used to:
- Open a business bank account
- Hire employees
- File federal taxes
- Apply for business licenses
- Work with payment processors (like Stripe or PayPal)
✅ It’s free and easy to apply online via irs.gov.
🏢 What Is an LLC?
An LLC (Limited Liability Company) is a legal business structure registered at the state level. It protects your personal assets in case your business faces lawsuits or debts.
Benefits of forming an LLC:
- Personal liability protection
- Pass-through taxation
- Legitimacy and credibility
- Easier access to business banking and funding
🔄 EIN or LLC First: What’s the Right Order?
✅ You should always form your LLC first, then apply for your EIN.
🔍 Why Should You Form Your LLC Before Getting an EIN?
Here’s why:
1. Your EIN is tied to your business name & legal entity
When you apply for an EIN, the IRS asks for:
- Your business name
- Your business structure (LLC, sole proprietor, etc.)
- Your state and formation date
If your LLC isn’t legally formed yet, you risk:
❌ Getting an EIN under the wrong business type
❌ Using a name that’s already taken in your state
❌ Having to cancel and reapply later
2. Avoid IRS Errors and Delays
If you apply for an EIN before forming the LLC and then try to update it later:
- The IRS may require you to cancel the EIN and start over
- You’ll waste time and delay your business setup
- Your paperwork may not match across agencies (IRS, bank, state)
3. Banks Require Your LLC Before Opening an Account
To open a business bank account, most banks require:
- Articles of Organization (LLC approval)
- EIN confirmation letter from the IRS
- Operating agreement
Without a legally formed LLC, most banks will reject your application — even if you have an EIN.
📝 The Right Order to Start a Business
Here’s the best order for most entrepreneurs:
- Choose your business name
- Register your LLC with the state
- Create an operating agreement (recommended)
- Apply for your EIN (once LLC is approved)
- Apply for any licenses or permits
- Open a business bank account
🧠 What If You Got an EIN First?
Don’t panic. You can either:
- Cancel the EIN and reapply with the correct LLC details
- OR keep it, if the name and structure still match (e.g., if you’re switching from a sole proprietorship to an LLC, you must get a new EIN)
💡 The safest approach is to start fresh after forming your LLC.
💼 Need Help with LLC and EIN Setup?
At FormLLC, we handle everything for you — in the right order.
✅ LLC registration in any U.S. state
✅ EIN application (express delivery)
✅ BOI report assistance
✅ Business bank account guidance
✅ Free registered agent (1st year)
✅ Business website, email & phone options
📧 Email: contact@formllc.us
🌐 Website: www.formllc.us
📱 WhatsApp: +91 6202619173
🔚 Final Thoughts
If you’re serious about launching a professional and compliant business, remember this:
Form your LLC first. Then get your EIN.
It’s the right order legally, financially, and operationally — and it’ll save you time, money, and stress.
Let FormLLC help you get it right from the start.