What's the Difference Between EIN and Reg No. for US Companies? Hear from Professionals!

Understanding the Difference Between EIN and State Registration Numbers in the U.S.

When doing business in the United States-whether as a startup or a multinational corporation-entrepreneurs often encounter two common but easily confused concepts the Employer Identification Number EIN and the State Registration Number also known as the Corporate ID or State Entity Number. Many people struggle to distinguish between the two when registering a company or handling tax-related matters. So, what exactly is the difference between an EIN and a State Registration Number? Drawing from recent business developments and expert insights, let’s clarify these two critical identifiers.

1. What is an EIN?

The Employer Identification Number EIN, issued by the Internal Revenue Service IRS, is a federal tax identification number for businesses. It functions much like a Social Security number for a company, identifying the business at the federal tax level.

Whether a corporation, partnership, limited liability company LLC, or nonprofit organization, any entity conducting business in the U.S. typically needs an EIN. It is used for

Filing taxes with the IRS, including corporate income tax and payroll tax

Opening a business bank account

Applying for business licenses

Hiring employees and managing tax and social security contributions

In 2025, the IRS launched a new online EIN application system, streamlining the process and enabling business owners to obtain an EIN more quickly. This change highlights the growing importance of EINs in business operations.

2. What is a State Registration Number?

The State Registration Number-also referred to as the State Entity Number or Corporate ID-is a unique identifier assigned by the state where the business is registered. While the name may vary slightly across states e.g., Business ID Number or Entity Number, its purpose remains the same to identify a company’s legal registration within that state.

This number is primarily used for

Identifying the business within the state’s system

Updating company information or submitting annual reports

Checking the company’s registration status

Communicating with state agencies

For example, in early 2025, California’s Department of Tax and Fee Administration updated its business registration process, requiring all new businesses to confirm their unique state registration number and complete electronic verification at the time of application. This reflects increasing regulatory scrutiny on business compliance at the state level.

3. Key Differences Between EIN and State Registration Number

While both numbers help identify a business, they differ significantly in terms of issuing authority, scope, and usage

1. Issuing Authority

EIN Issued by the federal IRS.

State Registration Number Issued by the state government.

2. Scope of Use

EIN Used for federal tax purposes and recognized nationwide.

State Registration Number Used for state-level administrative purposes and is valid only in the state of registration.

3. Timing of Application

EIN Can be applied for immediately after forming the company-even before formal state registration.

State Registration Number Automatically generated after the business is officially registered with the state.

4. Number of Identifiers

EIN Each business has only one EIN.

State Registration Number A business may have multiple numbers if it registers as a foreign entity in multiple states.

4. Common Misconceptions Among Business Owners

Many startup founders mistakenly believe that obtaining an EIN is sufficient for business operations, overlooking the importance of the State Registration Number. In reality, an EIN cannot replace a State Registration Number. For instance, even if you have an EIN, you cannot legally operate in California without completing the state’s formal registration process.

Cross-state operations often lead to confusion between these two identifiers. In 2025, a business owner operating in both Texas and New York mistakenly used the Texas registration number on a New York application, resulting in delays in obtaining a business license. Such issues are common during business expansion.

5. Expert Insights

We spoke with Linda Chen, a partner at VentureBridge, a prominent startup incubator based in Los Angeles.

The EIN and the State Registration Number are like a company’s national ID and household registration book, Chen explained. The EIN serves as the national identification, while the registration number proves your legal presence in a specific state. Both are essential.

She added that many entrepreneurs overlook the importance of the State Registration Number until they attempt to open a bank account or apply for a license. After completing the registration process, confirm your State Registration Number and keep it safe, she advised. For cross-state operations, she recommends consulting a legal or accounting professional to ensure compliance across jurisdictions.

Compliance is not optional-it is the foundation of long-term business growth, Chen emphasized.

6. How to Obtain and Locate These Numbers

EIN Apply online via the IRS website; the number is typically issued within minutes.

State Registration Number The number is provided after completing state registration and is usually included in the registration confirmation letter or business license.

To retrieve an existing EIN, check past tax documents or Form W-9. The State Registration Number can be found on official state correspondence or by searching through the state’s business registration portal.

7. Conclusion

Understanding the distinction between an EIN and a State Registration Number is crucial for legal and compliant business operations in the U.S. As regulatory requirements become more stringent, entrepreneurs must manage both numbers carefully. As industry experts emphasize, a company’s growth is built on a solid legal foundation and disciplined compliance practices.