One of the most important checks you must perform is ensuring that the freelancers you work with have an EIN number or Dun and Bradstreet number.
It may seem simple at first glance. You give them a W9 tax form, and they fill it out and submit it, right? Not so fast! There can be quite a difference between the DUNS number vs EIN number.
Read on to learn more!
What Is DUNS Number?
A DUNS number is a unique, nine-digit identification number assigned to a business by the U.S. Dun & Bradstreet (D&B) credit reporting agency.
It can be found on its D&B business credit report.
How They’re Used
It’s used to establish business credit and is also a key identifier in business-to-business commerce. D&B assigns a DUNS Number to a business location after verifying the business’s legal name, physical address, and telephone number.
It’s then used to create a D&B Report, which is a comprehensive report that includes credit information, payment history, and public filings. In some cases, it’s required to register with a government contracting agency.
Getting a DUNS Number
Getting a DUNS number is simple and free. You can request one online from the website. You’ll need to provide basic information about your business, such as your name, address, and contact information.
Once you submit your request, DUNS will assign you a number and send you a confirmation letter. You can then use this number when applying for business loans or lines of credit.
If you want to learn more about DUNS numbers, check out this link: https://www.nav.com/resource/duns-number/.
What Is EIN Number?
An employer identification number (EIN) is a nine-digit number assigned by the IRS. Small businesses with employees use EINs to identify their business for tax purposes.
How They’re Used
The IRS uses the EIN to identify taxpayers that are required to file various business tax returns. It’s also used by state and local governments, as well as businesses, to identify businesses for tax purposes.
It’s used to report taxes, file tax returns, and maintain tax records. It’s also used to apply for business licenses and permits, open business bank accounts, and enter business contracts.
Businesses must use the EIN when filing annual tax returns and applying for business licenses and permits.
Getting an EIN Number
You will need to complete an online application or submit a paper application to obtain an EIN number. The online application can be found on the IRS website.
The paper application can be found in the forms section of the IRS website. Once you have completed the application, you must submit it to the IRS.
Which One Do You Need
So, which one do you need? If you’re looking to open a bank account or establish business credit, you’ll need a D&B DUNS number. If you’re hiring employees or filing for business taxes, you’ll need an EIN.
In short, a D&B DUNS Number is required for business-to-business transactions, while an EIN is required for business-to-government transactions.
Learn the Difference Between DUNS Number vs EIN Number Right Now
The most important difference between a DUNS number vs EIN is if it’s used to track business credit, then go for DUNS number. If it’s used for tax purposes, then go for EIN number.
You’ll need to get a DUNS number if you’re looking to establish business credit. If you want an EIN number, you can apply for one online.
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