Applying for an Individual Taxpayer Identification Number for the first time can be confusing as it is a complicated process. There are lots of things to be kept in mind and many different documents that need to be arranged. For those of you who are unaware of the purpose and the requirements of an ITIN, and how to apply for an ITIN, read on to know and increase your knowledge on the subject.
What is an ITIN?
ITIN, which stands for Individual Taxpayer Identification Number, is a number used for tax processing issued by the IRS. It contains 9 digits and usually has a range of numbers from 70-88 as the fourth and fifth digits of the number.
It is issued to the people who are declared ineligible to obtain a Social Security Number by the SSA (Social Security Administration)
What you need to do if you are assigned a Social Security Number?
The law of United States prohibits the use of both ITIN and SSN at the same time. This is because anyone who is eligible to file taxes should do so and only the deserving should enjoy the benefits of SSN. Once you obtain a social security number, you must stop using your ITIN number and inform the IRS about it immediately so all your previous records can be placed under a single number.
Who is required to obtain an ITIN?
First thing you have to know about how to apply for an ITIN, is if you really need one. The IRS can issue ITIN to both residents and non-residents of the United States because both could be required to pay taxes according to the Internal Revenue Code and a valid ITIN is needed to file an income tax return. The individuals who require an ITIN are:
- US resident aliens who are filing for a tax return in the US (This is based on the days present in the US)
- A spouse or dependent of the aforementioned US resident alien or a US citizen
- Non resident aliens who are ineligible for SSN and are therefore required to file US tax returns
- Non resident aliens who need to file for a treaty benefit
- A Spouse or dependent of Non resident alien visa holder
- A professor, researcher or student who is filing fro, or claiming a tax return
- Individuals who receive distributions like dividends, pensions, annuities, royalties and others
- People who have assets or investments in the US and are in foreign or U.S based partnership
- US residents having bank accounts that bear interest
What is needed to file for an ITIN?
Individuals who want to know how to apply for an ITIN need to know about the documents that are required for the application process.
The first thing you need to do when filing for an Individual Taxpayer Identification Number is to complete the W-7 form from the IRS. Along with the IRS’s W-7 form, you need 1, or a combinantion of the following to prove your foreign status:
- A copy of your US income tax return
- Your passport or some other valid documents for identification (this includes an identification with a photo and one ID document from your country)
- State ID
- US driver’s license
- A valid National Identification Document that includes name, photo, address, date of birth and its expiration date)
- Dependents who cannot submit their passport are required to show their Birth Certificate
- Your voter registration from your country
- All your Visa documents
- US Citizenship and Immigration Services photo Identification documents
- Medical (Only for dependents)
- School Records for dependents and students under 18 years of age
Out of all these documents the passport is the only stand-alone document the IRS accepts.
What is the right time to apply for an ITIN?
An individual may apply for an ITIN during any time of the year. Just make sure you’re attaching a copy of your income tax return along with the W-7 form when applying for an ITIN number.
Therefore, you should submit your W-7 form as early as possible since it could take the IRS a couple of weeks to process your application. If you do not hear form an IRS representative, contact your local office on the contact number given on their official website.
Does it affect an individual’s status of immigration?
No. Obtaining an ITIN number does not change the status of your immigration or allow working in the USA.
Who can you ask for help when applying for an ITIN?
While you can go through the entire procedure yourself by mailing your application to the IRS with your tax return and a certified copy of a valid passport, taking the help of an Acceptance Agent drastically reduces the time taken for processing because they know how to apply for an ITIN in the right way.
Acceptance Agents are authorized by the IRS to assist individuals in obtaining their ITIN. They review their clients’ documentation, complete accuracy certificates and forward the certificate and acceptance to the IRS so that the process can commence. Some Acceptance Agents may charge a fee for their services.
Does the ITIN have an expiration date?
No. An Individual Taxpayer identification Number does not have an expiration date, but you are required to file at least one tax return every five years to keep your ITIN number active.
Apart from filing taxes, for what else do you need an ITIN for?
Since everyone’s ITIN is unique, it is also used for other purposes such as:
- Opening Bank accounts that bear interest: According to the Patriot Act, banks are required to collect information on the identity of their customers and are allowed to use ITINs for opening interest bearing bank accounts.
- Obtaining a driver’s license: Some US states allow the use of ITIN to receive a driver’s license, permit or a State ID
- Buying Real Estate, a Car, or any other item you want to buy on credit.
- Musicians, authors, and other artist are required to have an ITIN number if they wish to sell their music, books, or art via iTunes, Amazon, or other Internet sites.
If you want to apply for an, Individual Taxpayer Identification Number, or ITIN tax number and have any other questions, please feel free to contact us at 888-509-3616. If you have any suggestions please share those with us as well. Freedomtax ITIN Number has a professional team of IRS Certifying Acceptance Agents, and tax accounting professionals with more than 16 years of experience, helping immigrants with their ITIN application. Freedomtax can also help immigrant entrepreneurs incorporate a business in the USA. Freedomtax ITIN Tax Number Online services provides Quality, Professional Service with a Family Feel.