What is Sender ID?
Many people get Sender ID and Sender Policy Framework (SPF) confused. Sender ID is a Microsoft protocol derived from SPF, which validates one of the message's address header fields defined in RFC 2822. Essentially its purpose is to validate that an email message came from a legitimate source, in order to reduce spoofing.
Sender ID is pretty much obsolete nowadays, but some mail providers still use it to validate incoming messages, so it definitely doesn't hurt to implement.
How do I set it up?
Good news - here's a handy-dandy Wizard that walks you through the entire process of setting up your Sender ID record:
How can I test that it's setup properly?
Sender ID is one of many things that are validated by the Winning Email domain checkup tool: