What Exactly is a Sales Tax Number?

Monday, July 02, 2018
For new business owners, the amount of paperwork that must be completed to be an active, legally operating entity can be overwhelming. In addition to Federal forms, there are State forms and applications that must be submitted, depending on the type of entity to be registered. You may be wondering what a Sales Tax number is and if it is different from an IRS-EIN-Tax-ID. Here are some answers to frequently asked questions that can help clear up any confusion.

What is an EIN?

An EIN is assigned to a business or other entity upon the completion and submission of form SS4 online. Also known as a Federal Tax ID number, it acts much like a social security number by identifying the entity for business tax purposes. The document requires information such as the reason for applying for the EIN and the projected annual wages and earnings. A valid Federal Tax ID is required to:

      Pay state and local taxes
      Hire employees
      Set up payroll and pay wages
      Get business insurance.

When individuals with property, money or other assets die, they often have an executor for their estate. An estate tax ID number must be assigned before the estate is distributed to the heirs and beneficiaries so that the appropriate taxes can be paid.

State ID Numbers

Whereas the IRS assigns the EIN, State ID numbers are designated by the state. Although there are many types of business entities, there is only one type of State ID Number. However, it is known by many different names.

      Sales Tax Permit
      Reseller Permit
      Certificate of Authority
      Excise business Tax number
      Sales and Use Tax Number
      Taxpayer ID Number

Not to be confused with the EIN, a State ID is used by businesses to avoid paying sales tax to their suppliers, to collect sales tax from their clients and to file Sales Tax returns.


At Govt Assist, they have simplified the form for ease of use and accuracy. Use this Contact us link to download the forms, get help completing them and to expedite the processing. 




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