Is Your EIN Correct ?

Amy Hebbeler, Ali Trianfo, and John Christopher, Fraternal Law Partners

amy.hebbeler@manleyburke.com; ali.trianfo@manleyburke.com; john.christopher@manleyburke.com

Fraternal Law Partners has recently encountered several issues arising from an organization’s failure to engage in due diligence in obtaining and policing its Employer Identification Number (“EIN”). The issues we have encountered have caused substantial disruptions to the operations of the impacted organization.

As background, the EIN is the unique number that identifies the organization to the Internal Revenue Service (“IRS”). Below are the few situations we have encountered of which we believe organizations should be made aware.

1. Failure to Properly Apply as an Exempt Organization.

When an organization initially applies to the IRS for its EIN, it provides several pieces of critical information to the IRS, including the type of entity. With the relatively recent adoption of electronic filing as the exclusive means of submitting a series 990 tax return, and the IRS’ reliance upon the EIN as the essential identifier of a taxpayer for these purposes, the proper identification of a new organization as being an exempt organization on the application for its EIN, and the specific subsection under which the new organization’s exemption is based, is of heightened importance. Failure to make a proper designation of exemption to be associated with the organization’s EIN can lead the IRS to classify an organization as a taxable entity and to the rejection of Forms 990.

2. Chapter and House Corporation/Alumni Association Using Same EIN

Another specific situation we have encountered arises in the context of failing to properly police the use of an organization’s EIN. We have encountered organizations that improperly share an EIN, resulting in two entities utilizing the same EIN. For example, a chapter and a house corporation/alumni association file a single Form 990 using a shared EIN. Of course, a chapter and house corporation/alumni association are two distinct and separate entities as they have separate governing documents, officers and directors and operations. They should be treated as separate entities for both tax and liability purposes. As such, they should each have their own EIN.

3. Chapter Using Incorrect EIN

Another situation is where chapters filed their annual return with the IRS using the EIN of a different organization. We have encountered this situation in the context of a chapter utilizing the EIN of a national foundation, national fraternity, a university and local house corporations/alumni associations. This not only puts the chapter at risk for automatic revocation of its tax-exempt status for failure to file an annual return under its correct EIN, but it may also cause significant issues for the organization whose EIN was used to file the chapter’s return.

For example, national fraternities, fraternal foundations, and other organizations have experienced issues with unauthorized changes to their physical or mailing address, principal officer listing, subordinate status on a group exemption, and inconsistent records related to the organization’s gross receipts or net assets due to a chapter’s improper use of the incorrect EIN. This has not only caused practical operational issues, but it has also caused issues regarding foundation and university donor relations.

Ensuring that chapters have access to and use their unique EIN when filing an annual return is critical to ensure the chapter retains its exempt status and to protect the national organization or other affiliate from unauthorized changes to its IRS records.

4. Entity with Multiple EINs

As noted above, the EIN is the unique number that permanently identifies the organization to the Internal Revenue Service.^[1] It is similar in that regard to an individual’s Social Security Number. As such, an entity should only have one EIN and once the IRS assigns an EIN to an entity, it becomes that entity’s permanent federal taxpayer ID number.^[2] If an entity is unsure of the  EIN that was assigned to them, an officer duly authorized to act on behalf of the organization or an authorized representative, such as legal counsel,  can call the IRS and request information regarding a lost or misplaced EIN.^[3] An entity generally should not obtain a new EIN until it does its due diligence to determine that the IRS does not have any record of an EIN on file.

It is important that organizations utilize their own EIN to ensure proper identification and compliance. The issues above can be avoided by an organization engaging in due diligence in obtaining and policing its EIN. If an organization discovers that it has improperly utilized the EIN of another entity, or an entity has incorrectly utilized its EIN, it is essential for the organization to promptly correct the error in order to avoid any adverse effects to the organization.

Please contact Amy Hebbeler (amy.hebbeler@fraternallaw.com) or Ali Trianfo (ali.trianfo@fraternallaw.com) if you have questions regarding your EIN.

[1] Employer Identification Number, IRS, https://www.irs.gov/charities-non-profits/employer-identification-number#:~:text=Every%20organization%20must%20have%20an,PDF%20and%20its%20instructions%20PDF (last visited June 25, 2025).

[2] If You No Longer Need Your EIN, IRS, https://www.irs.gov/businesses/small-businesses-self-employed/if-you-no-longer-need-your-ein (last visited June 25, 2025).

[3] Employer Identification Number, IRS, https://www.irs.gov/businesses/employer-identification-number#multiple (last visited June 25, 2025).