There are many tax payers who find an ITIN – Individual Tax Identification Number to be quite confusing. The IRS uses this number to identify and track tax payers who are not eligible for a Social Security Number, but still have to pay their taxes. Here are answers to the most common questions which people have about the ITIN – Individual Tax Identification Number.
What is an ITIN – Individual Tax Identification Number?
An ITIN – Individual Tax Identification Number is a number which the IRS uses for identifying those tax payers that are not eligible for an SSN, but still have to pay taxes. ITIN contains 9 digits and the first of these is always a 9. If you do not have a social security number, but are eligible for it, you can not apply for an ITIN – Individual Tax Identification Number.
Acquiring an ITIN – Individual Tax Identification Number means you have to fill out the W-7 form and send to the IRs along with supporting documents. Once your application has been processed, you will get a letter than contains your ITIN. Be sure to save this as a record, because you will not get any card.
Why are you not eligible for SSN, but still have to pay taxes?
There are many reasons as to why you may have to pay taxes, but still cannot obtain a Social security number. Here are some of these.
- You are a non-resident alien; you will have to qualify either of the two tests for this, which are the substantial presence test and the green card tests.
- You are born in another country, but reside in the United States.
- You are a legal immigrant and have a temporary visa.
Is a tax payer who files on the basis of ITIN – Individual Tax Identification Number eligible for all the deductions?
If you file your return using your ITIN – Individual Tax Identification Number, you will not be able to utilize all the deductions. Examples of this include the earned income credit and the social security benefits. Later on, if you do become eligible for an SSN, you will receive these amounts back.
How do you apply for an ITIN – Individual Tax Identification Number?
- Obtain a W-7 form; you can download this from the IRS website or visit their nearest office.
- Fill out the form and attach documents that serve as proof of your identity and foreign status with it.
- Send the form to the IRS by email or submit the same to them in person.
Can the ITIN – Individual Tax Identification Number be used for other purposes than taxes?
An ITIN can be used for other purposes as well. Some of these are given here, but refer to IRS website for complete details.
- You can use your ITIN to open an interest bearing account at any bank.
- You can receive a state id card, a driving permit or a driving license in some states.
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