Is There a Difference Between Federal Tax ID & Social Security Number?

Social Security numbers are assigned by the Social Security Administration. The original and main purpose of Social Security numbers, since the inception of the program in 1936, has been to track your individual Social Security account. This was a requirement of the Social Security Act. Signed into law in 1935, it was originally a program to provide retirement income for American workers once they reached age 65. Social Security numbers have been used since this time to identify individuals and track income for reporting taxes, banking and credit.

Federal Tax ID numbers are assigned to businesses, organizations and entities by the IRS. The purpose of a Federal Tax ID is to track revenue -- or income -- that a business receives, as well as expenses, such as payments made to employees or contractors.

Social Security numbers can be ordered along with a baby's birth certificate. There are three types of Social Security numbers issues. One is for U.S. citizens and people who are legally able to live and work in the U.S. permanently. The other two types of Social Security cards are for people from other countries who are able to work with permission from the Department of Homeland Security and those who are not able to work.

Social Security numbers have nine digits, which are broken up into three parts. The first three digits identify where the card was issued, which is typically where the individual lives. The next two digits were originally for filing information. The final set of numbers have four digits, which are the person's individual identifying numbers.

Federal Tax ID numbers are also nine digits, though they are broken down in two sections. The first two digits indicate the office that issued the number, while the remaining seven digits are the business identification numbers. Neither Social Security numbers or Federal Tax IDs are even reissued.

Your personal information, such as your name and your age, are attached to your Social Security number. Keep this number private and only share it when necessary, such as with government agencies. In contrast, Federal Tax ID numbers are typically readily available, as a company must share that number with employees, contractors and anyone else who may need the number for their own business or tax purposes.