In a recent letter submitted to the Department of the Treasury and the Internal Revenue Service (IRS), the American Institute of CPAs (AICPA) expressed concerns with the timing currently involved with the procedure for business entities organized in the U.S. where the responsible party does not have a social security number or an individual taxpayer identification number needed to obtain an employer identification number (EIN).

An EIN is required for entities to obtain when starting a business or engaging in transactions in the U.S. It is used to open bank accounts, apply for business licenses, register with government agencies and submit many other applications, including paying and filing tax returns. The application is made with the IRS using one of three methods: online, by fax or mail, or by telephone.

The comments, which refer to Form SS-4, Application for EIN, request a change in the IRS EIN issuance procedures for certain entities. The AICPA recommends that the IRS change its issuance procedures and allow entities that are organized in the U.S. with a responsible person that lacks a tax identification number to be able to call the IRS and obtain the EIN over the phone, as entities organized outside the U.S. currently may do. This echoes recommendations submitted by the IRS Advisory Council.