ITIN stands for Individual Taxpayer Identification Number. This number for tax processing is issued by the Internal Revenue Service. It has a total of nine digits in all, that always start with 9 and has numbers between 70 and 88 in its 4th and 5th digit. These ITINs are issued to Individuals required by law to pay taxes, but do not possess a social security number since they are not eligible to have one.
No matter what the immigration status of an individual is, both residents as well as non resident aliens may be required to file, or report under IRS law.
Uses of an ITIN
ITINs are only used for federal tax reporting, and cannot be used for any other purpose. These numbers are issued by the IRS in order to help individuals follow the tax laws of the United States, and also to provide them with a means of effectively accounting, and processing for tax payments, and returns for those individuals that are not eligible to receive social security numbers.
There is a certain misconception about the ITIN that needs to be removed. Many people wrongly assume that you can work in the country once you possess this number. However, this is not true. This number also does not make a person eligible to receive social security benefits.
Individuals Needing ITIN Numbers
ITINs are issued to people such as foreign nationals by the IRS who do not possess a social security number, but have federal tax filing, and reporting requirements. For instance, a non resident alien who does not possess a social security number, and yet has the requirement of filing tax returns in the country for the purpose of claiming a tax refund under provisions of US tax treaty, will require an ITIN. Some of the other examples of this situation include the following:
- A spouse or dependent of a visa holder who is a non resident alien
- A spouse or dependent of a U.S. resident/ citizen alien
- A non resident alien who is required to file a tax return in the country
- A U.S. resident alien who has filing requirements for U.S. tax return based on the days where they are present in the country
The Need for an ITIN Number and the Application Procedure
You will need to apply for an ITIN if you are not eligible to apply for a social security number, and yet are in need of filing a federal income tax return. In order to apply for an ITIN, you will have to fill out the latest Form W-7. Along with this, you will have to attach a valid, and authentic federal income tax return unless an individual has exceptions in their circumstances. Along with this, include original documents proving proof of your identity.
You can also use the services of an Acceptance Agent that is authorized by the IRS, or visit a good, and authorized Taxpayer Assistance Center to help you out with documentations, and the application procedure.
When to Apply
The Form W-7 should be completed as soon as an individual feels ready to file their federal income tax return, since the return needs to be attached with the application. If an individual comes across some exception to the requirement in tax filing, then Form W-7 needs to be submitted along with documentations proving one’s identity as well as their foreign status. Additionally, supplemental documentations that substantiate one’s qualification for an exception also need to be attached soon after it is determined that an individual really does qualify for the exception.
An application for the ITIN number can be sent at anytime throughout the year. However, be sure that the application is sent in before the due date of the return. In case if it is received by the IRS after the due date. Then penalties, or interest rate may be charged. However, such a situation can easily be avoided by sending in the application in a timely manner.
Getting Help for the ITIN Application
If you are facing any difficulties with the ITIN application, then it is really easy to seek help. You can call in the IRS on their toll free number: 1 800 829 1040 in case you are present in the country. If you are not in the country, then you can simply call in at 267 941 1000 for any help, or information required for the completion of Form W-7 as well as the tax return, or simply to check your application’s status. However, this number is not toll free.
You can also seek assistance at Taxpayer Assistance Centers that are authorized by the IRS in the country so that you can get one on one consultation by professionals on the subject. Other than this, there are Acceptance Agents that are especially authorized by the IRS to help you out in any manner possible.
Receiving your ITIN
In case you qualify to receive an ITIN, and you have completed your application without any errors, then the IRS will send you a letter in which you will be assigned a tax identification number in approximately 7 weeks. You can call in the IRS on their toll free, or other number in case the status of your application is still pending even after 7 weeks. In case there is any issue with your application form, or attached documentations, then the agent answering your call will let you know about it. They will also let you know about any other reasons for the delay.
Getting an ITIN number is not a difficult process as long as you have with you all the required information, and you are aware of the right steps to follow. You should also know the difference between a social security number, and an ITIN number so that there are no problems, or confusions later on. The more you are aware, the simpler everything will be.