The ITIN Tax Number and the Social Security Number are important identification numbers issued by the government of the US to individuals residing in the country. Both these numbers are important, as they occupy a significant position in the legal structure of the country. There are certain similarities between the ITIN Tax Number and the Social Security Number, but also several stark differences. This not only creates confusion regarding their entitlement and uses, but also begs an answer to a very common question: which of the two is better?
As mentioned above, the ITIN Tax Number and the Social Security Number play an integral role in the overall legal administration and setup of the country. However, the fact that holding a Social Security Number renders its holders more advantages and privileges than holding an ITIN tends to place greater importance, and value, on the Social Security Number. To better understand which of the two is indeed better, here is a brief description of the benefits one derives from both:
ITIN Tax Number
The ITIN Number is issued to all those who are not eligible for a Social Security Number. It is issued by the Internal Revenue Service of the government of the US. The ITIN is only for tax filing and reporting purposes, and cannot be used for non-tax identification. However, in many states of the US, it is being increasingly used for purposes besides those of tax reporting. It is being used for opening bank accounts, and for obtaining credit cards and loans. ITIN Tax Numbers can also be used to claim Child Tax Credit.
However, there are certain limitations of having an ITIN Tax Number. For instance, an ITIN does not guarantee its holder immigration status or employment in the country. Also, the use of ITIN for transactions, like opening an account, depends largely on the laws that prevail in the state in question. Furthermore, certain privileges like Earned Income Credit are not extended to ITIN Tax Number holders.
Social Security Number
A Social Security Number is issued by the Social Security Administration of the government of the US to all citizens of the country. A Social Security Number has a wider scope than that of ITIN; it is not restricted to tax identification purposes only, but is rather used for various non tax purposes like obtaining property, driver’s license, etc. Holding Social Security Number also allows its holders to claim privileges like Earned Income Credit. This wider scope of the SSN naturally makes it more beneficial for its holders.
The scope and spectrum of the Social Security Number does make it more beneficial, and better, than an ITIN Tax Number. The ITIN faces certain limitations and constraints in its usage, which the Social Security Number does not. The latter offers more in terms of benefits and privileges to its holders than the ITIN Tax Number, making it a better source of identification for many people in the country.
Switching from the ITIN to SSN
People who have been thinking all this time that an ITIN is similar to SSN are in some serious trouble. ITIN (Individual Tax Identification Number) is a nine digit number issued by the IRS (Internal revenue Service) used mainly for the federal tax purpose. The ITIN helps individuals comply with the U.S tax laws and the IRS in turn is able to process tax returns and payments efficiently.
Whereas the SSN keeps the track of earning history of the U.S workers and this is how the social security entitlement and benefits are computed. Not only this, SSN enables the government agencies to explicitly identify and track information about an individual. The major difference between an ITIN and ISSN is that an ITIN number is issued to both the residents and non-residents of the U.S but the SSN is only issued to U.S workers.
Apply for ITIN
If you want to apply for an ITIN, you either do it yourself or through a CAA (Certified Acceptance Agent). If you’re doing it in-person you’re supposed to fill out a W-7 form (ITIN application from) which you get from the IRS office.
Attach 2 documents as a proof of your identity (birth certificate, passport, driver’s license etc.) and get them attested by the issuing agency. Along with these, complete your tax return and mail them in. On average it takes around 6 weeks. For assistance or questions the toll free number is 1-800-829-1040.
Another option you have is to get your ITIN via CAA. These acceptance agents are accredited by the IRS and their sole purpose is to help individuals who are applying for an ITIN number. They don’t really charge a fee and work as freelancers. They’re going to ask you for a couple of things like identification documents and tax return.
If there’s an issue with your tax return, they will make sure to review it themselves. Another benefit is that you don’t have to get your documents certified because your agent will by-default issue you an accuracy certificate and will assure the Internal Revenue Service, or IRS, that all the details you provided are correct.
Switch from an ITIN to SSN
If an individual wants to switch from an ITIN to SSN there’s a list of steps that should be followed.
- The very first thing you need to do is fill out SS-5 SSN application form. You can get this form online or you can visit a nearby social Security Office. Along with the form the things you need are your identity, age and citizenship. You can attach your driver’s license or your identity card as an identity proof.
- Submit these to the Social Security office and wait for at least 4 to 5 weeks before the SSN is issued to you. Meanwhile you can call their office to get an update or assistance. If it’s been more than 5 weeks then you should definitely call them.
- When you finally do receive your SSN, you could just notify the Social Security department that yes you have received it.
- Last but not the least, you’re supposed to provide the Social Security your ITIN because now that you’ve your SSN, your ITIN no longer is needed (by law). One individual cannot have both the numbers. Your SSN will replace your previous ITIN and all the taxpaying functions will now be dealt via SSN.
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.