Gokce Tandogdu
ITIN Specialist, itin.net
Non-residents can obtain a U.S. Individual Taxpayer Identification Number (ITIN) by submitting Form W-7, Application for IRS Individual Taxpayer Identification Number, directly to the IRS or through an authorized Certified Acceptance Agent (CAA). This process requires proving your foreign status and identity with original or certified documents, and you must have a qualifying reason for needing an ITIN, such as filing a U.S. tax return or meeting specific tax treaty benefits. This guide explains how to get an ITIN number for a non-resident in the USA.
Eligibility for an ITIN
You are generally eligible for an ITIN if you are a non-resident alien who does not have and cannot get a Social Security Number (SSN) and you have a U.S. tax filing requirement or are claiming a tax treaty benefit. Common situations include:
- Non-resident aliens filing a U.S. tax return (Form 1040-NR): This is the most common reason. If you earn U.S. source income as a non-resident, you may need to file a tax return and, therefore, an ITIN.
- Dependents or spouses of U.S. citizens/resident aliens: If you are a dependent or spouse of a U.S. taxpayer and need to be claimed on their return, you may need an ITIN.
- Dependents or spouses of non-resident alien visa holders: Similar to the above, if you are a dependent or spouse of a non-resident alien who holds a U.S. visa and has an SSN or ITIN, you might need one.
- Beneficiaries of U.S. trusts, estates, or U.S. partnerships: If you are involved with these entities and have U.S. tax implications.
- Individuals claiming tax treaty benefits: Many tax treaties allow for reduced withholding on certain types of U.S. income. To claim these benefits, you often need an ITIN.
- Non-resident aliens who are partners in a U.S. partnership: If you are a partner in a U.S. partnership, you may need an ITIN.
It is important to note that an ITIN is for tax purposes only. It does not authorize you to work in the United States, nor does it provide eligibility for Social Security benefits.
Reasons for Needing an ITIN
The IRS has specific criteria for who qualifies for an ITIN. You must have a reason that falls into one of the following categories as outlined by the IRS:
- Reason 1: Non-resident alien filing a U.S. federal tax return. This is the most frequent reason. If you are not a U.S. resident for tax purposes but have U.S. income that requires you to file a tax return (e.g., income from a U.S. business, rental property, or employment), you need an ITIN.
- Reason 2: Resident alien (non-U.S. citizen) filing a U.S. federal tax return. This applies if you are a resident alien for tax purposes (e.g., through the substantial presence test or green card test) but do not qualify for an SSN. This is less common for non-residents seeking an ITIN.
- Reason 3: Dependent or spouse of a U.S. citizen or resident alien. If you are a dependent or spouse and are required to have a taxpayer identification number for a U.S. federal tax return, and you are not eligible for an SSN.
- Reason 4: Dependent or spouse of a non-resident alien visa holder. If you are a dependent or spouse of a non-resident alien who is not eligible for an SSN but has a U.S. visa, and you are required to have a taxpayer identification number for a U.S. federal tax return.
- Reason 5: Non-resident alien claiming a tax treaty benefit. If you are a non-resident alien receiving income from U.S. sources and wish to claim a reduced rate of, or exemption from, tax under a U.S. tax treaty. You will generally need to file a U.S. tax return with the appropriate treaty statement to claim this benefit.
- Reason 6: Non-resident alien who is a partner in a U.S. partnership. If you are a partner in a U.S. partnership, you may need an ITIN.
- Reason 7: Non-resident alien spouse or dependent of a U.S. partnership. If you are the spouse or dependent of a non-resident alien partner in a U.S. partnership and you are required to obtain a taxpayer identification number.
When applying, you will need to select the appropriate reason code on Form W-7.
Required Documentation for ITIN Application
To apply for an ITIN, you must provide documentation that proves both your identity and your foreign status. The IRS requires original documents or certified copies from the issuing agency. The most commonly accepted documents are:
- Passport: This is the preferred document as it proves both identity and nationality/immigration status. If your passport is expired, you can use it if it was valid when issued and accompanied by another valid document proving identity.
- National Identity Card: Must contain your photograph, name, address, date of birth, and expiration date.
- U.S. Driver's License: Must contain your name, address, date of birth, photograph, and expiration date.
- Birth Certificate: Generally acceptable for dependents under 18. Must have the required information and be translated into English if not already.
- Foreign Driver's License: Must contain the required information and photograph.
- Foreign Military Identification Card: Must contain the required information and photograph.
- Visa: Must be valid and show your name and expiration date.
- U.S. State Identification Card: Must contain the required information and photograph.
- Foreign Voter's Registration Card: Must contain the required information.
- Civilan I.D. card (for military family members): Must contain the required information and photograph.
- Medical/Health Insurance Card: Must contain your name, address, date of birth, and expiration date.
- School Records (for dependents under 18): Such as a report card or transcript, showing name, address, date of birth, and enrollment date.
How to Handle Original Documents
If you are applying by mail, you have two options for submitting your identification documents:
- Mail original documents to the IRS: The IRS will review your original documents and return them to you. This process can take a long time, and there is a risk of losing your original documents. The IRS states that they return documents within 60 days of receipt.
- Use a Certified Acceptance Agent (CAA): A CAA, like itin.net, is an individual or entity authorized by the IRS to help applicants obtain ITINs. CAAs can verify your original documents and send certified copies to the IRS. This allows you to keep your original documents, which is often the preferred method.
If you are applying in person at an IRS Taxpayer Assistance Center (TAC) that offers ITIN application services, you can present your original documents there. However, not all TACs offer this service, and appointments are often required.
How to Apply for an ITIN
There are three primary methods to apply for an ITIN:
1. Apply by Mail
This method involves completing Form W-7 and mailing it along with your original supporting identification documents and a federal tax return (or other documentation demonstrating your need for an ITIN) to the IRS address specified in the Form W-7 instructions. The IRS address for mail applications is:
Internal Revenue Service Austin, TX 73301-0009 USA
This method requires you to send your original passport and other vital documents through the mail, which can be a concern for many applicants. The IRS estimates that processing can take 7 to 11 weeks, though it can sometimes take longer, especially during peak tax seasons.
2. Apply Through a Certified Acceptance Agent (CAA)
Using a CAA is often the most convenient and secure way to apply for an ITIN. CAAs are individuals or entities trained and authorized by the IRS to assist applicants. They can:
- Review your Form W-7 application for completeness and accuracy.
- Verify your original identification documents and send certified copies to the IRS, allowing you to keep your originals.
- Submit the entire application package to the IRS on your behalf.
itin.net, as an authorized CAA, provides this service. This method significantly reduces the risk of losing your original documents and can streamline the application process. The processing time through a CAA is generally the same as applying by mail, as the CAA forwards the application to the IRS for final processing and issuance of the ITIN.
3. Apply in Person at an IRS Taxpayer Assistance Center (TAC)
Some IRS Taxpayer Assistance Centers offer in-person ITIN application services. You can schedule an appointment to bring your completed Form W-7, original identification documents, and tax return to the TAC. An IRS employee will review your application and documents. However, availability of this service varies by location, and appointments can be difficult to secure. You cannot mail your application to a TAC; you must apply in person.
What to Include with Form W-7
Regardless of the application method chosen, you must include the following with your Form W-7:
- Completed Form W-7: Ensure all sections are filled out accurately. Pay close attention to your name, address, foreign tax identification number (if applicable), and the reason code for your application.
- Original or Certified True Copies of Identification Documents: As detailed above, you need documents proving identity and foreign status. If you are using a CAA, they will certify these documents.
- Federal Tax Return: For most applicants, a completed federal income tax return must be submitted with Form W-7. There are exceptions, such as when applying for an ITIN to claim tax treaty benefits without filing a return, or for certain dependents. The specific requirements depend on your reason for applying.
Exceptions to Filing a Tax Return
In certain situations, you may not need to file a federal tax return with your Form W-7. These exceptions typically apply when:
- You are applying to claim benefits under a U.S. tax treaty.
- You are applying as a dependent or spouse of a U.S. citizen or resident alien, or a non-resident alien visa holder, and do not have a U.S. income filing requirement.
- You are applying as a third-party designee on a tax return.
For these exceptions, you will need to provide alternative documentation as specified in the Form W-7 instructions. This might include a letter from the withholding agent confirming treaty benefits or other proof of your situation.
Processing Time and Costs
Processing Time
The IRS generally takes 7 to 11 weeks to process an ITIN application. This timeframe can be longer during peak tax filing seasons (January through April) or if your application is incomplete or contains errors. If you apply through a CAA, the time it takes for them to process and forward your application is in addition to the IRS processing time. However, the benefit of using a CAA is that they can help ensure your application is complete, potentially reducing delays.
Costs
There is no fee charged by the IRS to apply for an ITIN. However, if you use a Certified Acceptance Agent (CAA) or an Acceptance Agent program, they may charge a fee for their services. These fees vary by agent. If you choose to mail your original documents to the IRS, you will incur postage costs. The cost of obtaining certified copies of identification documents from the issuing agency may also apply.
Common Mistakes to Avoid
When applying for an ITIN, several common mistakes can lead to delays or rejections:
- Incomplete Application: Failing to fill out all sections of Form W-7, or leaving required fields blank.
- Missing or Incorrect Documentation: Not providing sufficient proof of identity and foreign status, or submitting expired documents. Ensure you understand the IRS requirements for original or certified copies.
- Incorrect Reason Code: Selecting the wrong reason for needing an ITIN can cause the application to be rejected.
- Not Including the Tax Return: For most applicants, a completed U.S. federal tax return must be submitted. Failing to do so is a common reason for rejection.
- Mailing Original Documents Without Tracking: If mailing originals, use a trackable shipping method. The IRS is not responsible for lost documents.
- Errors in Personal Information: Discrepancies between the name on your identification documents and the name on your tax return or Form W-7 can cause issues.
- Outdated Forms: Using an old version of Form W-7. Always download the latest version from the IRS website.
What Happens After You Get Your ITIN?
Once the IRS processes your application, they will mail you an official notice with your ITIN. This notice is often referred to as CP-565. Keep this notice in a safe place, as it contains your unique ITIN. You will need it for all future tax filings and interactions with the IRS.
- Filing Future Tax Returns: You must use your ITIN on all future U.S. federal tax returns. If you have a continuing U.S. tax obligation, you will file annually.
- Opening a U.S. Bank Account: While an ITIN is not a substitute for an SSN, some U.S. banks may accept an ITIN as a form of identification for opening certain types of accounts, especially for non-residents. However, requirements vary significantly between institutions. For a U.S. bank account, you might also need other documentation like proof of address. Providers like Mercury, Relay, or Brex may have specific requirements for non-residents.
- Forming a U.S. LLC: If you are forming a U.S. LLC, you will likely need an EIN (Employer Identification Number) for the business, not an ITIN for yourself, although your ITIN might be required for certain ownership disclosures or tax filings related to the LLC. You can apply for an EIN using Form SS-4. If you are a foreign owner of a U.S. LLC, you may also need to file Form 5472 to report certain transactions, which requires an ITIN or EIN.
- ITIN Renewal: ITINs do not expire, but they do become inactive if not used on a federal tax return for three consecutive tax years. If your ITIN becomes inactive, you will need to reapply by submitting Form W-7 and supporting documentation again. The IRS also issues ITIN renewal notices periodically to taxpayers whose ITINs have not been renewed and are due for renewal.
When to Seek Professional Help
Applying for an ITIN can be straightforward for many, but complex situations may warrant professional assistance. Consider seeking help if:
- You have a complex tax situation: This could involve multiple sources of foreign and U.S. income, significant foreign assets, or complicated tax treaty claims.
- You are unsure about the required documentation: If you are having trouble gathering the correct original or certified documents, a professional can guide you.
- You are applying for a large number of individuals: For example, if you are a business entity assisting foreign employees or partners.
- You prefer not to mail original documents: Using a Certified Acceptance Agent like itin.net, a qualified tax professional, or an IRS-authorized Acceptance Agent provides a secure way to handle your identification documents.
An experienced tax professional or a Certified Acceptance Agent can ensure your application is accurate and complete, minimizing the chances of delays or rejection. They can also provide guidance on other U.S. tax obligations, such as filing Form 1040-NR or understanding U.S. LLC requirements.