We usually use numbers to identify a wide range of things. One of the things you record when you buy a new computer or a cellphone is the serial number, which is unique to each of them and identifies it. The same is valid for identity numbers or taxes: every business and every individual in America requires a tax identification number.
An ITIN, is a tax processing number only available for certain nonresident and resident aliens, their spouses, and dependents who cannot get a Social Security Number (SSN). Please keep reading to learn why you need it and how to fill apply for one.
What is an ITIN number?
ITIN stands for Individual Taxpayer Identification Number and is a tax processing number issued by the Internal Revenue Service (IRS) to ensure that people pay taxes even if they do not have a Social Security number (SSN) and regardless of their immigration status.
In other words, because you’ll be required to file returns and tax payments, you’ll be able to receive an ITIN even if you’re a qualifying non-resident or a resident alien (meaning, if you have a green card).
What documents do I need to get an ITIN number?
Make sure you have the following documents in place when applying for your ITIN number:
A valid form of ID: You’ll need to show proof of your foreign nationality or U.S. residency status. Valid documents are those issued by the U.S. government, such as a driver’s license, passport, or military identification card. You can also show a foreign I.D. such as a driver’s license, military I.D. card, or official birth certificate (for children under 18). State-issued IDs, U.S. visas, or foreign voter registration cards are also applicable.
Form W-7: This form is available in both English and Spanish. If this is the first time requesting an ITIN number, you’ll have to include additional documentation. You can check out more information at the official IRS website.
Your current federal tax return: The good news? You can attach your federal income tax return as you process your ITIN number. You can consult the IRS official website if you still have doubts about asking for a tax return.
For more information about application standards and acceptable documents, read “Revised Application Standards for ITINs.”
How to Apply for an ITIN?
There are different ways you can apply for your ITIN number, such as:
1) IRS Taxpayer Assistance Centers: If you require guidance and don’t want to mail your proof of identity and foreign status documentation, then you can schedule an appointment at one of the following IRS Taxpayer Assistance Centers. Once processed, your ITIN will be sent to the address you provided in your form.
2) Certifying Acceptance Agent: You can also schedule an in-person appointment with a Certifying Acceptance Agent in and outside the U.S. You won’t be required to mail your proof of identity or foreign status documents.
3) By mail: You can mail your W-7 form, tax return, and original identification documents to the IRS at the following address:
Internal Revenue Service
Austin Service Center
P.O. Box 149342
Austin, TX 78714-9342
Your original documents will be returned within 14 weeks. To get more details on where and how to turn in your ITIN application, consult the IRS official guide.
When to apply for an ITIN number?
You should apply for an ITIN number when it’s time to file your income tax return date, which typically lands before April 15. If you submit your taxes and W-7 application, you could be penalized for being late.
How long does it take to get an ITIN number?
Once you turn in your application and qualify, the average time it takes for the IRS to send you your ITIN number through the mail is six weeks. If you want to check your ITIN application status, you can call the IRS toll-free number: 1-800-829-1040.
Why do I need an ITIN?
If you’re trying to apply for an ITIN number, you’re probably doing it for financial or legal reasons. Some of the benefits you can acquire with an ITIN number are the following:
Access to potential funding opportunities: Some lenders require a Social Security Number to apply for a business loan. But many other working capital options for business owners allow you to use an ITIN number to pre-qualify.
To file or process taxes: If you’re earning an income in the U.S., you must pay taxes on what you earn. Therefore, you’ll need this number to file your taxes, even if you don’t have a Social Security Number.
To open a bank account: Depending on the bank and eligibility requirements, you could use an ITIN number to get an account, save up, or separate your personal and business expenses.
Establish a credit history: As you acquire funding and credit, you’ll begin building your credit history. Solid credit history could benefit you when getting a mortgage or financing.
While an ITIN does not provide you with the same benefits as a Social Security number, all individuals working in the U.S. should use it when filing taxes. Additionally, an ITIN number can grant you and your business various legal and financial benefits.
For example, it helps you comply with tax laws, obtain a driver’s license in some states, open a bank account, and even apply for several business funding opportunities. Most importantly, it’ll also give you more comprehensive options if you want to guarantee your business success.
Disclaimer: The content of this article is based on the author’s opinions and recommendations alone. This material has been prepared for informational purposes only. It is not intended to provide and should not be relied on for tax, legal, or accounting advice. We suggest consulting with your tax, legal, and accounting advisor before engaging in any transaction.