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Private Taxpayer Identification Number (ITIN)
A Powerful Tool for Immigrant Taxpayers

Last updated JANUARY 2017 | Versión en español
Endnotes and citations available in the PDF version.

What is an ITIN?

An Private Taxpayer Identification Number (ITIN) is a tax processing number issued by the U.Southward. Internal Revenue Service (IRS). An ITIN consists of 9 digits, beginning with the number 9 (i.due east., 9XX-XX-XXXX). Since 1996, the IRS has issued ITINs to taxpayers and their dependents who are non eligible to obtain a Social Security number (SSN).

Every bit a effect of a new law and as discussed below, many ITINs will elapse and need to be renewed.

Why does the IRS issue ITINs?

All wage earners—regardless of their clearing status—are required to pay federal taxes. The IRS provides ITINs to people who are ineligible for an SSN and so that they can comply with tax laws.

Who uses an ITIN?

Taxpayers who file their tax return with an ITIN include undocumented immigrants and their dependents as well as some people who are lawfully nowadays in the U.S., such as certain survivors of domestic violence, Cuban and Haitian entrants, student visa–holders, and sure spouses and children of individuals with employment visas. As of August 2012, the IRS had assigned 21 million ITINs to taxpayers and their dependents.

Once a person who has been issued an ITIN is eligible to apply for an SSN, the person may no longer apply the ITIN.

What is an ITIN used for?

ITINs are issued by the IRS specifically as a means to pay federal taxes. While the IRS issues them solely for this purpose, ITINs may sometimes be accepted for other purposes, such as for opening an involvement-begetting depository financial institution business relationship, in employment dispute settlements, or for obtaining a mortgage.

Why do undocumented immigrants demand an ITIN?

In addition to existence required to pay taxes, immigrants benefit from filing income taxation returns considering:

• It demonstrates that they are complying with federal revenue enhancement laws.
• Filing federal taxes is a way for immigrants to further contribute to the economy.
• It is i fashion that people who may have an opportunity to legalize their immigration condition and become U.S. citizens tin evidence that they accept "adept moral character."
• Immigrants tin can use revenue enhancement returns to document their work history and physical presence in the U.Southward. In guild to be eligible for legal immigration status under any future immigration reform, people who currently are unauthorized to be in the U.Southward. most probable will have to be able to prove that they take been employed and have lived continuously in the U.Southward. for a certain number of years.
• People who file tax returns tin can claim crucial economical supports, such as the Child Tax Credit, including the refundable portion (too known as the Boosted Child Tax Credit).
• Filing a revenue enhancement return is required in guild to be able to merits insurance-premium tax credits for family members—often U.South. citizen children—who are eligible for health care coverage nether the Affordable Care Human activity (ACA, or "Obamacare"). These taxation credits are necessary to help make wellness insurance affordable to people who otherwise would not be able to purchase it.
• Individuals who are eligible to file their taxes with an ITIN tin plant that they are eligible for an exemption from the ACA's individual mandate, which requires that people accept health insurance. Undocumented immigrants are excluded from all ACA benefits, so they are not eligible to buy health insurance through the ACA's health care marketplace, even at full cost.
• Immigrant workers who receive settlement payments as a consequence of an employment-related dispute will be subject to the maximum taxation withholding rate, unless they have an ITIN. For instance, for a worker with an ITIN, the withholding on back wages paid to the worker because of a settlement will be based on the worker's family condition and the number of exemptions the worker can claim. By contrast, if the worker did non accept an ITIN, the withholding would be figured as if the worker were single with no exemptions. Similarly, for workers without ITINs, the withholding on payments other than wages, e.chiliad., on payments for punitive damages, is figured at the "backup withholding" rate of 28 per centum, whereas workers who have ITINs ordinarily would have no withholding on such nonwage payments.

What is an ITIN non used for?

An ITIN does non authorize a person to work in the U.S. or provide eligibility for Social Security benefits. An ITIN does not provide a person with immigration status.

Do ITIN-filers pay taxes?

Yep! In 2010, over 3 million federal taxation returns were filed with ITINs, which accounted for over $870 million in income taxes. In the same yr, over 3 million unauthorized workers, including ITIN-filers, paid over $13 billion into Social Security.

Is it prophylactic to utilize an ITIN?

Generally, yes. The IRS has strong privacy protections in place to ensure that immigrants who report their income and file their taxes are non at risk of having their information shared. Under Internal Revenue Lawmaking section 6103, the IRS is generally prohibited from disclosing taxpayer information, including to other federal agencies. However, certain exceptions apply. For instance, the IRS is required to disclose taxpayer information to certain U.South. Treasury Department employees when they request it for tax administration purposes or to other federal agencies if information technology's needed for a nontax criminal investigation and a federal court has ordered that it be provided.

What documents must a person present when applying for an ITIN?

ITIN applicants are required to provide proof of their identity, strange nationality condition, and residency. (Proof must be submitted that any bidder claimed as a dependent resides in the U.S., unless they are from Mexico or Canada or are a dependent of U.S. military personnel stationed overseas.) In 2015, Congress codified the severe restrictions that the IRS had put in place on the types of documents that new ITIN applicants may nowadays.

In social club to apply for an ITIN, the applicant must

1. complete a Form Due west-7, Application for IRS Individual Taxpayer Identification Number, along with their federal income revenue enhancement return, and
2. prove theiridentity and strange nationality status by providing a combination of original documents (run across the table below) or certified copies of the documents. (A certified copy is one that the original issuing agency provides and certifies every bit an verbal copy of the original document and that contains an official stamped seal from that agency. Notarized copies are non acceptable.)

The IRS will have only a combination of the 13 documents listed in the tabular array below as proof of identity and/or foreign nationality status. Applicants who tin can present a passport have to present only one document. Otherwise, they will need to nowadays at least two documents or certified copies of at least two documents.

How does an applicant file for an ITIN?

An applicant tin employ for an ITIN past mail, in person through a designated IRS Taxpayer Assist Heart (TAC), or with the help of an Credence Amanuensis (AA) or a Certified Acceptance Agent (CAA) authorized past the IRS. An bidder who resides exterior the U.Southward. may apply past mail or in person to an IRS employee or a designated U.S. embassy or consular mail.

Applicants who apply for an ITIN by mail directly with the IRS must submit either the original of each supporting document or a certified copy of each supporting document. Applicants who practise not want or are unable to mail their original documents or certified copies to the IRS may take them in person to a TAC or CAA to have the documents (or certified copies) verified and immediately returned to them. However, not all TACs provide ITIN-related services, or they may provide them simply during restricted business hours. Because the number of TACs and CAAs is limited, many ITIN applicants simply aren't able to take their applications and documents to a TAC or CAA.

As of 2016, CAAs are allowed to authenticate the passport and birth certificate for dependents (though not other forms of acceptable identity documents). For primary and secondary applicants, CAAs are authorized to authenticate all thirteen forms of acceptable identification documents. TAC offices are authorized to cosign only the passport, birth document, and foreign national ID cards for ITIN applicants (including for dependents).

How long does information technology take to receive an ITIN?

Outside of peak processing times (between January and April), it should take upward to vi weeks for an applicant to receive their ITIN. However, considering most ITIN applications must exist filed with taxation returns, they are typically filed during peak processing times. As a result, information technology can take viii to 10 weeks to receive an ITIN. Whatsoever original documents or certified copies submitted in support of an ITIN awarding volition be returned within 65 days. People who practice not receive their original and certified documents inside 65 days of mailing them to the IRS may call one-800-908-9982 to check on their documents' whereabouts.

Subsequently the ITIN application has been approved, the IRS volition process the taxation return within 6 to 8 weeks.

How do you utilize for an ITIN past post?

Who processes ITIN applications?

All ITIN applications are processed past the ITIN unit in the IRS Submission Processing Centre in Austin, Texas. Tax returns attached to the ITIN applications are "sent for processing." Taxation examiners in the ITIN unit of measurement review ITIN applications and supporting documentation. Based on the tax examiner's review, the awarding will be either:

• assigned — the IRS mails a detect with the assigned ITIN to the applicant;
• rejected — the IRS mails a discover informing the applicant (a) that the ITIN awarding was rejected, (b) the reason for the rejection and (c) that the applicant must file some other application to reapply for an ITIN; or
• suspended — the ITIN application is suspended because of a procedural issue or because it has questionable data. (IRS guidelines define a questionable awarding as 1 for which the tax examiner identifies one or more discrepancies on the awarding. A procedural outcome is one in which the applicant did not properly consummate the application or did not attach the required documentation to the application.)

How long is an ITIN valid?

ITINs previously were issued for an indefinite menstruum. In 2015, Congress mandated that people who received ITINs prior to January 1, 2013, are required to renew their ITINs on a staggered schedule betwixt 2017 and 2020 (see the tabular array below). In addition, the new law states that an ITIN will expire if the person to whom it was issued fails to file a revenue enhancement render for iii sequent years.

An ITIN issued afterward December 31, 2012, will remain valid unless the person to whom it was issued does not file a revenue enhancement render—or is not included every bit a dependent on the return of another taxpayer—for iii consecutive years.

Who needs to renew their ITIN?

Ii categories of ITINs expired on January 1, 2017:

• any ITIN not used to file a tax return for the last three years (2013, 2014, or 2015)
• ITINs with centre digits 78 or 79 (i.e., 9XX-78-XXXX and 9XX-79-XXXX)

According to the IRS, the agency sent notification messages in August and September 2016 to all individuals whose ITINs had the center digits 78 and 79 "that were currently beingness used on a taxation return," informing them that their ITIN would expire on January one, 2017. Anybody who needs and wants an ITIN to file their taxes and whose ITIN expired on January 1, 2017, must employ to renew their ITIN.

What is the process for renewing an ITIN?

The procedure for renewing an ITIN is the same as the process for applying for a new ITIN. Applicants are required to submit identity and foreign nationality status documents (see "What documents must a person present when applying for an ITIN?," above), and proof of U.S. residency must be included for applicants claimed as dependents. However, dissimilar new ITIN applications, renewal applications do non require that a tax return be attached.

To file for an ITIN renewal, fill out the Westward-seven course and check the "Renew Existing ITIN" box. If an individual has an expired ITIN but is not required to file taxes, they do non demand to renew their ITIN. Yet, if in the future an individual with an expired ITIN is required to file a U.South. federal tax return using that ITIN (including for a dependent), they volition need to renew the ITIN at that time.

What are the barriers to getting an ITIN?

Because ITIN applicants face many difficulties obtaining certified copies of their identity documents, and considering of the express options for in-person verification of these documents, many ITIN applicants may be forced into the vulnerable position of going without valuable identity documents for weeks or months (or longer, if their documents are lost). For some, this has proven too risky and burdensome.

Equally a result, the ITIN rules that went into effect in 2012 caused a dramatic decline in the number of ITIN applications. In 2013, there were nigh 50 per centum fewer ITIN applications than in each of the previous three years. In addition, the IRS rejected over 50 percent of the applications that were submitted in 2013. Co-ordinate to the National Taxpayer Advocate, dramatic declines in applications for ITINs connected in 2014 and 2015 as a upshot of these stricter application rules, which have at present been codification into law.

What problems are created past the barriers to getting an ITIN?

When the requirements for getting an ITIN are too hard to meet:

• Immigrants will not be able to get an ITIN and file income tax returns. Equally a result, they won't exist able to comply with their obligations under federal tax laws.
• Immigrants who can't get an ITIN or file revenue enhancement returns will face issues if they always go eligible for immigration relief. Certain applications require proof that the applicant has filed taxation returns to institute that they have "skillful moral character."
• Immigrants who tin can't get an ITIN or file tax returns will also find it harder to evidence their work history and that they have been physically present in the U.S. for a certain amount of time, which is besides relevant for immigration applications.
• Low-income immigrants will exist prevented from claiming revenue enhancement supports for which they are eligible, including the Child Tax Credit (CTC), the Boosted Child Revenue enhancement Credit (ACTC), and credits under the Affordable Care Act (ACA). Barriers to obtaining the CTC and ACTC can push low-income children deeper into poverty.
• If they tin can't file tax returns, mixed–immigration status families with members who are eligible for health insurance nether the ACA volition non be able to prove that they accept complied with the individual mandate. And if they received a health insurance premium revenue enhancement credit, they won't be able to provide the data nearly their health insurance and income that the IRS needs in guild to reconcile the tax credit that was advanced to them with the tax credit for which they're actually eligible. This could prevent them from being able to renew their wellness insurance the post-obit yr.

FOR More than Data, CONTACT
Jackie Vimo, 202.621.1028 or [email protected], or
Avideh Moussavian, 202.621.1031 or [e-mail protected]

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Source: https://www.nilc.org/issues/taxes/itinfaq/

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