EIN & ITIN Basics for New California Professional Corporations

Why This Step Trips People Up

Once your Professional Corporation is formed, you need a federal tax ID before you can open a business bank account, hire staff, or run payroll. Two acronyms show up here constantly, EIN and ITIN, and they get confused often enough that it's worth spelling out exactly what each one does.

EIN: Your Business's Tax ID

An Employer Identification Number (EIN) is issued by the IRS to your Professional Corporation itself, not to you personally. It's what your bank, payroll provider, and the IRS use to identify your business. Every PC needs one, regardless of the owner's citizenship or residency status. Applying seems simple on the surface, but small mismatches between your EIN application and your Articles of Incorporation are a common reason banks delay opening a business account.

ITIN: A Personal Tax ID for Non-U.S. Citizens

An Individual Taxpayer Identification Number (ITIN) is different — it's issued to a person, not a business, and it's specifically for individuals who need a U.S. tax ID but aren't eligible for a Social Security Number. This mostly comes up for non-U.S. citizen founders who are forming or owning a U.S. entity but don't have SSN eligibility. If that's your situation, you may need both: an EIN for the business and an ITIN for yourself.

Getting the Sequence Right

The order matters. Your Professional Corporation needs to be properly formed, with your Articles of Incorporation approved, before the EIN application goes in, and inconsistencies between your formation documents and your EIN application are one of the most common reasons an application gets flagged or delayed. We prepare and file EIN and ITIN applications correctly the first time as part of formation, so you're not stuck redoing paperwork weeks in when you're trying to open a bank account or bring on your first hire.

What This Doesn't Cover

An EIN or ITIN isn't a tax filing, and getting one doesn't mean your tax setup is complete. That's still your CPA's role — we handle getting the correct IDs in place; your CPA handles what happens with them on your tax return.