It seems that more than a few readers end up here on FinanceGourmet because they are searching for information about taxpayer identification numbers. As a result, they end up here where I discuss IRS tax id numbers for businesses, specifically, the EIN and FEIN numbers. While that article is a good discussion of business tax numbers, it leaves out an important tax identification number for individuals.
ITIN Individual Taxpayer Identification Number
For most people, your taxpayer id number is your Social Security number. The IRS requires to use your SSN for tax filing purposes if you have one. However, there are some people who need a tax id number to file documents or forms with the IRS, who do not have a Social Security number, and who cannot get one. For these people, the IRS offers a special Taxpayer Identification Number or ITIN.
An ITIN is a faux Social Security number generated by the IRS specifically for the purposes of filing required tax documents. It is not a Social Security number and is not supposed to be used as one. Obviously, as a pseudo-SSN, it cannot be used for employment purposes or for filing for Social Security benefits. Likewise, is not supposed to be used to file for credit, however, that depends upon the creditor and how sophisticated their systems are, or whether they even care.
How to Apply for a Taxpayer Identification Number
Applying for a taxpayer ID number is a lot like applying for an EIN (Employer Identification Number). Taxpayers who need an ITIN apply for one using a standard IRS form. In this case, Form W-7 is required when applying for an ITIN. One of the things to notice is that there are limited cases when the Form W7 is used. If you have a SSN, or are eligible to get one, you are required to use that number instead. Also, do not file for an ITIN if you have an application pending for a Social Security number.
Do I Need an ITIN?
The IRS usually issues ITINs to people from other countries who have to report income or file taxes in one way or another. Typically, the way most people find out that they need an ITIN is that they are told they need to file a certain tax form, and, of course, the first line of that form asks for the Social Security number. In short, if you are required to file a tax form that requires an SSN and you don’t have one, then you’ll need to apply for an ITIN.
What is an ITIN?
As we mentioned earlier, an ITIN is a identification number used on tax documents in place of a Social Security number. As with anything run by the government, IRS forms are very standardized. That means that not just any number will do. An identification number needs to look like a SSN and fit in the same form spaces. In other words, it needs to be in form XXX-XX-XXXX.
All ITINs start with a 9. In addition, the middle two numbers used to always be between 70 and 88. However, in 2011, the IRS expanded the pool of available numbers. Now, there are three ranges of numbers that ITINs may be pulled from:
- 900-70-0000 through 999-88-9999
- 900-90-0000 through 999-92-9999
- 909-94-0000 through 999-99-9999
An ITIN does not change anything about what you are or are not eligible for with regards to taxes. For example, an ITIN does not make foreign nationals eligible for the Earned Income Credit. Likewise, having an ITIN does not change what you are or not required to report or file with the IRS.