When Does a Church Need an EIN Number?

An Employer Identification Number, or EIN, is a unique nine-digit number the Internal Revenue Service (IRS) assigns to business entities. It functions much like a Social Security number does for an individual, serving as a federal tax identifier for the organization. While churches automatically receive tax-exempt status under section 501(c)(3) of the Internal Revenue Code, certain activities and operational decisions will require them to obtain an EIN.

When a Church Must Obtain an EIN

A primary reason a church must obtain an EIN is if it compensates individuals for their work, making them employees. For non-ministerial staff—such as administrators, musicians, or custodians—the church must have an EIN to report wages and manage payroll taxes. This includes withholding federal income tax and FICA taxes, which are reported on forms like Form 941, Employer’s QUARTERLY Federal Tax Return, and Form W-2, Wage and Tax Statement.

The rules for ordained ministers are unique, as they are considered “dual-status” under federal law. They are employees for federal income tax purposes but are considered self-employed for Social Security and Medicare. As a result, the church does not withhold FICA taxes from the minister’s salary or pay the employer’s share.

Ministers are instead responsible for paying their own self-employment (SECA) taxes. Even with this arrangement, the church still needs an EIN to report the minister’s income for federal income tax withholding on their Form W-2.

Another common trigger for needing an EIN is opening a church bank account. Financial institutions require an EIN to open an account in an organization’s name to comply with banking regulations. This practice also ensures that the church’s finances are kept separate from the personal funds of its leaders or members.

An EIN is also necessary for certain financial actions. A church needs an EIN if it establishes a tax-deferred pension plan for employees or files Form 990-T. This form is required to report and pay tax on unrelated business income (UBIT).

While not mandatory, some churches choose to formally apply for recognition of their tax-exempt status by filing Form 1023, Application for Recognition of Exemption. This step provides official documentation for donors or for obtaining state tax exemptions. The application for Form 1023 requires the church to have an EIN before it can be submitted.

Information Required to Apply for an EIN

To apply for an EIN, a church must complete and submit IRS Form SS-4, Application for Employer Identification Number. The application requires the church’s full legal name as recorded in its organizing documents, such as its articles of incorporation or constitution. You will also need to identify a “responsible party,” who is typically a principal officer, minister, or board member.

Other required information includes:

• The church’s physical mailing address
• The responsible party’s full name and their Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN)
• The entity type, which is “Church or church-controlled organization” for most
• The primary reason for applying, such as “Hired employees”
• The date the church was legally formed and the closing month of its accounting year
• The highest number of employees expected in the next 12 months, if any

The EIN Application Process

The most efficient method for obtaining an EIN is through the IRS’s online application portal. This process is an interactive interview based on Form SS-4, and upon successful validation, the EIN is issued immediately. This allows the church to receive its federal tax identifier within minutes.

Alternatively, applications can be submitted by mail or fax by sending a completed Form SS-4 to the appropriate IRS service center. The processing time for these methods is significantly longer, taking approximately four to five weeks.

Once the EIN is assigned, the IRS will send a confirmation notice, known as the EIN assignment letter. This document should be stored securely with other permanent legal and financial records.