The Internal Revenue Service (IRS) established the individual tax identification number (ITIN Number) in 1996. Due to the influx of immigrants from other countries coming to the United States, the U.S. established ITIN for foreign nationals and individuals who were not qualified for a social security number (SNN).
The ITIN made it mandatory for them to pay taxes. Several people not qualified for SSNs, such as foreign students, foreign investors, undocumented workers, and spouses or children of immigrants on temporary visa are all required to pay taxes. However, for people who are planning to apply for an ITIN should know that there is a significant difference between an individual tax identification number, ITIN Number and a social security number.
Differentiating between ITIN and SSN
The Social Security Administration issues the social security number whereas the Internal Revenue Service issues the individual tax identification number, ITIN Number. However, the ITIN should not be mistaken as an official form of identification, but should only be considered for paying tax. The SSN in the United States is the only official identification form for receiving many benefits. In order to avoid confusion between the two, instead of a card, the Internal Revenue Service only issues letters to people with their ITIN information. People with an ITIN document are not eligible to receive the same benefits as the people with a SSN card:
- ITIN holders are not eligible to receive SNN benefits such as Earned Income Tax Credit (EITC) or any other social security benefits.
- The individual tax identification number, ITIN Number, does not allow immigrants to obtain legal status or the right to work in the U.S.
- The ITIN under no circumstances is a substitute for the SSN on the work authorization form (I-9).
- An individual cannot prove their legal status through an ITIN Number.
Although there are few states that allow individuals with an individual tax identification number to register for a driver’s license. Furthermore, there are banks and credit unions that allow them to open bank accounts, get a line of credit, purchase a car, and receive a loan.
Some states allow individuals with ITIN numbers to do that following mentioned above because they want to ensure that the people driving on the streets are properly licensed and to preserve their safety by depositing the money in the bank instead of carrying it.
Do you need an ITIN?
If you don’t have a social security number and you are not eligible to obtain one, but you have the need to file for federal tax identification number or file a federal income tax return, then by law you are required to apply for an ITIN.
However, if you have submitted an application for a Social security number, then don’t file for the ITIN number. Only proceed to apply, after the SSN office has rejected your application. Another thing to take into consideration is that the United States law clearly states that an individual alien cannot have both an SSN and an ITIN number.
The IRS will never share your ITIN information with the Homeland Security for immigration enforcement reasons as maintaining an individual’s privacy is the basis of the U.S. tax system.
If you need more information about our accounting and tax services, please contact us at 407-344-1012. Freedomtax Accounting’s staff has been providing honest accounting services and tax services for 15 years. Our Orlando accounting and tax firm has its main offices in Kissimmee, FL. Our services are provided nationwide, but mainly in the Central Florida market to areas like Orlando, South Orlando, Kissimmee, St. Cloud, Poinciana, Clermont, Davenport, and Hunters Creek, FL. Our tax accountants and IRS enrolled agents (irs ea) specialize in corporate accounting and bookkeeping, tax services, tax preparation, back taxes help, tax debt relief, tax resolution, tax planning, itin numbers, incorporations, and non profit 501c3 tax exempt status applications.