There is a lot of confusion among people about the ITIN tax number, a unique tax processing identification number that facilitates tax filing and reporting requirements. The number is issued by the Internal Revenue Service to individuals who do not qualify for Social Security Number. Many people seem to have doubts regarding ITIN tax number and the way they work. Concerns have been voiced regarding the fact that it is known (incorrectly) to illegally grant quasi legal status to the people residing in the US. People are also under the impression that they provide certain benefits to their holders, for example authorization to foreign nationals to work in the country.
These misconceptions are just that – misconceptions. The concerns raised and the doubts voiced are not based on legitimate grounds, which cause people to fall under false impressions regarding the functions of ITIN tax number. This article attempts to address some of the confusion by discussing a few legitimate facts about ITIN tax number.
Fact#1: ITIN Tax Number is created for tax purposes ONLY
The ITIN tax number, or Individual Tax Identification Numbers, are issued for tax processing purposes only. They don’t have any identification beyond the scope of the US tax system. ITIN tax number were introduced by the Internal Revenue Service in July 1996 to assist tax filing and reporting requirements of those individuals who do not hold Social Security Numbers. ITIN tax number hence exist only for tax, and not any non-tax, purposes.
Fact#2: ITIN Tax Numbers are NOT like SSNs
Contrary to a widely held belief, Individual Tax Identification Numbers do not work in the same way as Social Security Numbers do. First of all, ITIN tax number are not cards like SSNs. They are rather sent to recipients via letter. Secondly, Social Security Numbers qualify for a far greater range of benefits and uses than the ITIN tax number does. The only benefit that it indeed provides is facilitation for tax processing. The benefits offered to SSN holders, like Earned Income Tax Credit, are not extended to I ITIN tax number holders.
Fact#3: ITIN Tax Number holders DO pay taxes
The ITIN tax number is not a way for individuals to evade taxes. Rather, ITIN tax number build a larger tax base by allowing more people to pay taxes via their Individual Tax Identification Numbers. In 2001 alone, a total of $300 million was received in taxes from ITIN tax number filers only; an amount which otherwise would have gone undocumented.
Fact#4: ITIN Tax Number does NOT provide immigration benefits
Because the Individual Tax Identification Number is only a tax processing number, it is wrongly assumed to provide illegal immigration status to its holders. ITIN tax number do not offer quasi legal status to people. Having an ITIN tax number does not qualify an individual to reside in the US illegally.
Fact#5: ITIN Tax Number does NOT provide work authorization in the US
Just like ITIN tax number cannot provide immigration benefits, similarly, they cannot provide work authorization in the US. An ITIN tax number holder does not qualify to work in the US unless he or she fulfills the legal requirements for foreign nationals working in the country. In a similar vein, ITIN tax number cannot be used to prove work authorization on an Employment Eligibility Verification Form, more commonly known as the I-9 Form.
If you want to apply for an 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.