EIN obtained by service vs diy

Here's the thing: an EIN is free from the IRS. Always has been. Always will be. Yet formation services routinely charge $50-$150 for it. Why? Because they know founders are confused and willing to pay for convenience.

Getting an EIN yourself takes 15 minutes. The IRS site is easy to use. You don't need a lawyer or an accountant. All you need is basic info about your LLC.

But services make it seem complicated. They say things like "we'll handle the paperwork" and "we'll make sure it's done correctly." It's marketing. The IRS doesn't reject EIN applications unless you're a terrorist or tax evader.

Here's what you need to know to make the right call.

Quick comparison

What is an ein?

An Employer Identification Number (EIN) is a nine digit number the IRS gives you. Think of it as a Social Security number for your business. You need one to open a business bank account, hire employees, file taxes, and apply for business licenses.

What is an EIN and why you need it covers the basics. Every LLC needs one. Even single member LLCs with no employees need an EIN to open a bank account.

The EIN is free. It comes from the IRS. You don't pay a thing. The only cost is your time.

Diy EIN process

Getting an EIN on your own is pretty simple. Here's what you gotta do:

1. Head to the IRS site. Find the EIN application page. It's a.gov site, not some third party site.
2. Pick your entity type. Choose "Limited Liability Company." Then decide if you're a single member or multi member LLC.
3. Fill out the form. You'll need your LLC name, address, state, and the name and SSN of the responsible party. That's you.
4. Submit. Hit submit. You'll get your EIN right away.
5. Save your confirmation. Download the confirmation letter (CP-575) and keep it. You'll need it for banks and tax filings.

That's it. 15 minutes. No cost. No headache.

Can you start a LLC yourself covers the basics. Getting an EIN? Even easier than forming your LLC.

Common mistakes to avoid:

• Watch out for third party sites. Some of them charge you for something that's free. Just go straight to the IRS site.
• That's the wrong entity type. You need to pick "Limited Liability Company," not "Corporation" or "Partnership."
• That's the wrong responsible party. The responsible party has to be a real person with a valid SSN or ITIN. Your LLC won't work.
• Keep the confirmation. Hold onto the CP-575 letter. You'll need it for banks and tax filings.

The IRS website is reliable. The form is simple. The questions are simple. If you can fill out a basic form, you can get an EIN yourself.

Using a service for EIN

Using a service means you pay someone to get your EIN for you. You fill out their questionnaire. They submit the application to the IRS. Then they send you the confirmation.

Why we charge for an EIN:

• Upsell. EIN service is a classic add on. It's easy money for the service since the IRS does all the work.
• Convenience. Some founders don't want to mess with government websites. They'd rather pay someone to do it.
• Bundling. Services bundle EIN with formation. Feels like one package. But you're paying extra for something that's free.

What services typically charge:

• LegalZoom: $79-$99
• ZenBusiness: $99 (comes with formation)
• Bizee (Incfile): $99 (comes with formation)
• Inc Authority: $99 (sometimes free when you form with them)
• Northwest: usually part of their $39 formation package

LegalZoom review covers their pricing. They cost a lot for an EIN.

Some services throw EIN into their formation package. Others make you pay extra. Always check the fine print. Some "free" formation offers still charge $99 for EIN service.

If you're using a service, Inc Authority vs ZenBusiness shows how each one handles EIN. Some include it. Others don't.

Cost comparison

The math is simple. DIY is free. Services want $50 to $150. Same 15 minute process, you're just paying someone else.

Is EIN service worth paying for digs into that question more. Most of the time, the answer is no.

The "$199 EIN mistake"

There's a mistake a lot of founders make. They Google "get EIN," click some third party site that looks official, and pay $199 for an application that's actually free.

These sites look like the IRS. They've got official looking logos and names that sound like the government. And they charge you for something you can get for free.

The $199 EIN mistake every founder makes digs into this trap. It's so common. And you can avoid it.

How to avoid it:

• Always use the official IRS website. The URL should end in.gov, not.com.
• Don't pay for EIN. It's free.
• If you're using a formation service, ask if EIN is included or if it's an extra charge.

The biggest mistake when choosing a LLC service is paying for stuff you can get for free. The EIN is one of them.

Which one makes sense for you

Choose DIY if:

• You're comfortable filling out forms
• You want to save money
• You don't have to rush (EIN is instant online)
• You're already filing your LLC yourself

Choose a service if:

• You want it all in one package
• You don't wanna deal with the IRS website
• You'll pay $50 to $150 just for convenience
• You're using a formation service that throws it in for free

If your formation service throws in an EIN for free, grab it. If they want money for it, skip it and do it yourself.

Here's the bottom line: the IRS website works. It's reliable. It's simple. You can't mess it up. Paying $50 to $150 for something that takes 15 minutes is a waste of money.

Still unsure? DIY filing vs using a service walks through the bigger picture. The EIN is only one part of it.

One last thing: some services throw EIN into their formation package, then hit you with an extra fee at checkout without warning. Don't pay for these LLC upsells breaks down which add-ons you can skip.