What is an ITIN number?
Individual Tax Identification Number or ITIN is a nine-digit tax processing number issued by the Internal Revenue Service (IRS) to foreign nationals (both resident and non-resident aliens) who have federal tax reporting or filing requirements (to claim tax benefits) but are not eligible to obtain a social security number or SSN.
It is an equivalent to the SSN for foreigners who are not eligible for an SSN. They can use this number to file their taxes, open a bank account and even apply for loans etc.
We also explain the whole process in the following video.
Why is the ITIN important?
Like we said above, ITIN is important because it allows non-immigrants without SSN to file their tax returns to comply with federal and state tax laws. It also helps you in opening a bank account, get a credit card and build your credit score – which is one of the most important things to keep in mind.
How to apply for an ITIN
Below are the steps to file for your ITIN number
Fill your W-7 Application for IRS
Individual Taxpayer Identification Number (ITIN)
Here’s the form - https://www.irs.gov/pub/irs-pdf/fw7.pdf
There is a checkbox in the beginning of the form that asks for a reason to apply for ITIN.
If you’re applying as a spouse of H1B visa holder, then you need to select the check box ‘e’ (spouse of resident alien) and if you are applying as a child of H1B visa holder, you need to select, ‘d’ (dependent of a resident alien).
Note that for tax purposes, a spouse is not a dependent. The rest of the form is quite simple and self-explanatory.
File your Federal Income Tax Return
Attach IRSW-7 form to the front of your valid Federal Income Tax Return (Form 1040, Form1040A, and Form 1040EZ) unless you qualify for an exception (see page 3 of Form W-7).
You may use Free TAX USA, TurboTax or other free e-software to fill your return, leave the SSN section blank (for whom you are applying ITIN), fill your return and print it out.
As you will be filing your tax return as an attachment to your ITIN application, you should NOT mail your return to the address listed in the Form 1040, 1040A or 1040EZ instructions.
Instead, send your Tax return, Form W-7 and proof of identity documents to the address listed in the Form W-7 instructions at:
Internal Revenue Service, Austin Service Center, ITIN Operation, P.O. Box 149342, Austin, TX 78714-9342.
Always keep a copy of your file and you don’t need to give return envelope for sending back original documents. Applicants are permitted to include a prepaid Express Mail or courier envelope for faster return delivery of their documents.
The IRS will then return the documents in the envelope provided by the applicant.
Accepted Documents for ITIN application
You will need the original documents or certified copies of them to establish your identity and your connection to a foreign country (“foreign status”) and support the information provided on the Form W-7.
A certified document is one that the original issuing agency provides and certifies as an exact copy of the original document and contains an official stamped seal from the agency.
A passport is the only document that proves both identity and foreign status. For dependents, the passport must have a date of entry to be a stand-alone document. If a passport is not submitted, a combination of two or more documents must be submitted to meet the document requirements.
National identification card (must show photo, name, current address, date of birth, and expiration date)
U.S. driver's license
Civil birth certificate (required for dependents under 18 years of age)
Foreign driver's license
U.S. state identification card
Foreign voter's registration card
U.S. military identification card
Foreign military identification card
Visa
U.S. Citizenship and Immigration Services (USCIS) photo identification
Medical records (dependents only - under 6)
School records (dependents only - under 14, under 18 if a student)
Certification of Supporting Documents
According to revised rule in 2013, application for ITIN, must include original documentation or certified copies of these documents.
The certification can be done by the issuing agency or U.S. embassy or consulate. Notarized or Apostilled copies of documentation are no longer accepted.
Most people do not want to send their original documents to the IRS because it is risky and there may be some emergency where they might need their passport or other original documents that they’ve sent.
Don’t worry. If you don’t want to send your original documents to the IRS, there are 2 other options as well.
Option 1 - Certifying Acceptance Agent
Apply for an ITIN in-person using the services of an IRS-authorized Certifying Acceptance Agent. This will prevent you from having to mail your proof of identity and foreign status documents.
The CAA will return the documentation immediately after reviewing its authenticity.
Option 2 - IRS Taxpayer Assistance Center
Make an appointment at a designated IRS Taxpayer Assistance Center. This will also prevent you from having to mail your proof of identity and foreign status document
TACs provide in-person help in providing ITIN on appointment basis (update, from 2017 onwards) and are able to authenticate passports and National ID documents.
For dependents, TACs can verify passports, national identification cards, and birth certificates. These documents will be returned to you immediately.
After processing, the IRS will issue your ITIN through the mail.
When should you apply for ITIN?
You can apply for an ITIN any time during the year when you have a filing or reporting requirement. At a minimum, you should complete Form W-7 when you are ready to file your federal income tax return by the return's prescribed due date. If the tax return you attach to Form W-7 is filed after the return's due date, you may owe interest and/or penalties.
How long does it take?
You will receive a letter from the IRS assigning your tax identification number usually within seven to eleven weeks if you qualify for an ITIN and your application is complete
How to track my application?
You can call the IRS toll-free at 800-829-1040 if you are in the United States or 267-941-1000 (not a toll-free number) if you are outside the United States. This service allows you to check the status of your application seven weeks after submitting Form W-7 and your tax return.
Does an ITIN number Expire?
The IRS policy states that Individual Taxpayer Identification Numbers will expire if not used on a federal tax return for any year during a period of five consecutive years.
In other words, the IRS will not deactivate your ITIN if you have been using it on at least one tax return in the past five years, and it will remain in effect as long as you continue using it to file US tax returns.
You can easily reapply using W-7 Form and follow the same process we explained above if you have to activate your ITIN and file a federal tax return. Remember that attached to the ITIN application form; you will have to submit all the required documents again.
Summary & Conclusion
To summarize:
ITIN number is needed for you to file your tax returns.
You can apply for your ITIN number by filling the form W7
You need to file this form along with your tax returns for that year (when you're applying for the first time).
You can file your tax return using any of the tax filing system such as the Free TAX USA
Since it is the first time, you need to send it to a different address which is in Austin, Texas.
But you have to send your original passport as a proof of you visa status and identity.
If you don't want to send your original document and wait for 7 weeks, you have 2 other options.
You can either go to a CAA or an IRS Tax payer assistance center.
Both these entities will verify your document and give it to you right away.
The current wait time for your ITIN number is between 7-11 weeks.
We hope that you found this Guide helpful. Please share your thoughts in the comments below. Also, feel free to share it with those you think may benefit from this information.