To close an EIN with the IRS, you mail a written letter asking the agency to deactivate the business account tied to your Employer Identification Number. There’s no form for it. The IRS won’t act on the request, though, until you’ve filed every required final return, paid any balance owed, and wrapped up your employment tax obligations. The letter itself is short; the work leading up to it is where closures usually stall.1Internal Revenue Service. If You No Longer Need Your EIN
What Closing an EIN Actually Means
An EIN is permanent. Once the IRS assigns one to your entity, it stays assigned forever, similar to the way a Social Security number stays with a person. What the IRS will do is deactivate the account, which tells the system the business is no longer operating and no future returns should be expected.
Request deactivation when the business has genuinely stopped: a sole proprietorship that shut down, a partnership that dissolved, or a corporation that liquidated. If a sole proprietorship incorporates, the new corporation needs its own EIN, and the old one should be deactivated.2Internal Revenue Service. When to Get a New EIN
You do not need to close your EIN for routine changes: updating your business name, changing your address, or adding locations. An LLC that changes its tax classification also keeps its existing EIN as long as the legal entity itself hasn’t changed.2Internal Revenue Service. When to Get a New EIN
File Your Final Tax Returns First
You cannot send the letter and walk away. The IRS expects every required return for the year you close, and the specific ones depend on your entity type.3Internal Revenue Service. Closing a Business
Sole Proprietors
File Schedule C with your Form 1040 for the year you close. Add Form 4797 if you sold business property or equipment, and Form 8594 if you sold the entire business. Self-employment tax still applies to net earnings of $400 or more.3Internal Revenue Service. Closing a Business
Partnerships
File a final Form 1065 with the “final return” box checked at the top of the first page. Check the “final K-1” box on each partner’s Schedule K-1. Report capital gains or losses on Schedule D (Form 1065), and file Form 4797 if the partnership sold business property. Late partnership returns due after December 31, 2025 carry a penalty of $255 per partner for each month or partial month the return is late, up to 12 months.4Internal Revenue Service. Failure to File Penalty
Corporations
Before filing your final income tax return, file Form 966 (Corporate Dissolution or Liquidation) within 30 days of adopting a resolution or plan to dissolve, with a certified copy of the resolution attached. This deadline is easy to miss during a wind-down.5Internal Revenue Service. Form 966, Corporate Dissolution or Liquidation
C corporations then file a final Form 1120; S corporations file a final Form 1120-S. Check the “final return” box, and on an S corp check “final K-1” on each shareholder’s Schedule K-1. Report capital gains and losses on the appropriate Schedule D.3Internal Revenue Service. Closing a Business
Close Out Employee and Payroll Obligations
If you had employees, several steps come before the deactivation letter. Employment tax compliance is actively enforced, and skipping any of these will delay a clean closure.3Internal Revenue Service. Closing a Business
- Deposit all withheld income tax, Social Security, and Medicare taxes. Failing to withhold or deposit these can trigger the Trust Fund Recovery Penalty, which reaches you personally.
- File a final Form 941 or 944. Check the box indicating the business has closed, enter the date of final wages, and attach a statement identifying who will keep the payroll records and where.
- File a final Form 940 and check box “d” in the Type of Return section.
- Issue Forms W-2 to each employee by the due date of your final Form 941 or 944, and file Form W-3 to transmit Copy A to the Social Security Administration.
Settle the Balance and Loose Ends
Pay any outstanding tax balance in full. If you can’t pay everything at once, contact the IRS about options; an unpaid balance will block a clean closure.6Internal Revenue Service. What if I Close My Own Business
Report gains or losses from sales of business property or equipment on Form 4797, whatever your entity type.7Internal Revenue Service. About Form 4797, Sales of Business Property
Outside the IRS, cancel state and local business registrations, licenses, and permits. Most states require articles of dissolution or a certificate of termination filed with the secretary of state, with fees that vary by jurisdiction. Close business bank accounts and resolve vendor invoices and loan balances. Until this is done, the business isn’t closed; it’s dormant, and dormant businesses invite problems.
How to Write and Send the Deactivation Letter
The IRS has no form for closing an EIN. Send a letter that includes:1Internal Revenue Service. If You No Longer Need Your EIN
- The legal name of the entity
- The EIN
- The business address
- A copy of the EIN Assignment Notice, if you still have it
- The reason for closing the account, for example, “business permanently ceased operations on [date]”
Mail the letter to one of these two addresses:
Internal Revenue Service
MS 6055
Kansas City, MO 64108
Internal Revenue Service
MS 6273
Ogden, UT 84201
Keep a copy of everything you send. The IRS does not publish a processing timeline for these requests, so your dated copies are your proof that you took action.
Why Leaving an Inactive EIN Open Is a Bad Idea
Some owners stop filing and let the account sit. That creates two problems.
The IRS may still expect returns from an account it considers active. When they don’t arrive, the failure-to-file penalty runs 5% of the unpaid tax per month, up to 25%. For returns due after December 31, 2025, the minimum penalty for filing more than 60 days late is $525 or 100% of the tax owed, whichever is less. Even a zero-balance account can generate notices.4Internal Revenue Service. Failure to File Penalty
An unused EIN is also a target for identity theft. Someone with your EIN can file fraudulent returns or fake W-2s in the business’s name. Warning signs include a rejection notice for a return you didn’t file, notices about W-2s you didn’t submit, or a balance-due notice for taxes you don’t owe.8Internal Revenue Service. Report Identity Theft for a Business
How Long to Keep Records After Closing
Don’t shred everything once the account is deactivated. IRS retention periods track the statute of limitations on audits and collections: three years for records supporting a filed return, four years for employment tax records, six years if you underreported gross income by more than 25%, seven years if you claimed a deduction for worthless securities or bad debt, and indefinitely if you never filed or filed fraudulently.9Internal Revenue Service. How Long Should I Keep Records
Keeping everything for at least seven years after your final return covers most situations. The deactivation letter, the EIN Assignment Notice, and any IRS correspondence about the closure are worth keeping permanently. They’re the proof you closed the business the right way.