ITIN for Small Business Owners: When You Need One in 2026

What Is the Difference Between an ITIN and an EIN for a Business?

The IRS issues two different identifiers that small business owners regularly confuse. The ITIN is a 9-digit personal tax ID for individuals who cannot get an SSN. The EINis a 9-digit business tax ID for entities (LLCs, partnerships, corporations). A non-resident founder of a US LLC typically needs both: the EIN for the LLC and the ITIN for the owner's personal return.

The EIN is free from the IRS and can be obtained by fax in 4 to 6 weeks for foreign founders. The ITIN takes 7 to 11 weeks through standard IRS processing.

When Does a Small Business Owner Actually Need an ITIN?

• Single-member LLC owned by a foreign founder. The LLC is disregarded; income flows to the owner's 1040 or 1040-NR.
• Partnership or multi-member LLC with foreign owners. Each foreign member needs an ITIN to receive a K-1.
• US-source self-employment income above the IRS filing threshold ($400 for self-employment net earnings).
• Royalty, rental, or investment income from US sources that requires Form 1040-NR.
• Spousal or dependent ITINswhen the family files jointly on a US business owner's return.

For LLC-specific rules, see ITIN for LLC owners.

How Does a Small Business Owner Apply for an ITIN?

1. Complete Form W-7 on the October 2024 revision or later, picking the line 6 code that matches the filing reason.
2. Attach the federal tax return (typically Form 1040 or 1040-NR with Schedule C, Schedule E, or K-1 attachments).
3. Include identity documents: foreign passport alone is cleanest; otherwise two documents from the IRS list.
4. Submit through a Certifying Acceptance Agent or mail to the IRS ITIN Operation in Austin, TX.

For the broader business owner playbook, see ITIN for small business.

What Do Banks and Vendors Need From a Small Business Owner?

US banks generally ask for the owner's ITIN on the beneficial-ownership form when opening a business account. The LLC provides its EIN; the owner provides their ITIN. Payment platforms (Stripe, PayPal, Square) follow the same pattern: EIN for the business profile, ITIN for the owner's personal tax certification (W-9 or W-8BEN).

Vendors that pay the business under contract use the EIN. Vendors that pay the owner personally use the ITIN.

How Long Until a Small Business Owner Has Their ITIN?

The IRS quotes 7 to 11 weeks for standard ITIN processing. Off-peak applications (May through December) usually land in the faster end of that window. Peak season (January through April) stretches to 9 to 13+ weeks because of the volume of W-7s attached to Form 1040 returns.

For full timing, see the processing time guide.

What Are the Most Common Small Business Mistakes With ITINs?

• Confusing the ITIN with the EIN. The two have different purposes and cannot substitute for each other on tax forms.
• Skipping the federal tax return attached to Form W-7 when no exception applies.
• Applying too late. Without an ITIN, the business loses tax credits, faces backup withholding, and risks late filing penalties.
• Letting the ITIN expire after 3 years of non-use on a federal return.