Gokce Tandogdu
ITIN Specialist, itin.net
An ITIN begins with the number 9.
The IRS assigns an Individual Taxpayer Identification Number (ITIN) to individuals who are not eligible for a Social Security Number (SSN) but need a U.S. taxpayer identification number for tax purposes. The first digit of every ITIN is a 9. The remaining digits are a randomly assigned serial number, followed by a four-digit number that indicates the year of issuance. For example, an ITIN might look like 9XX-7X-XXXX. The ITIN is a nine-digit number issued by the Internal Revenue Service (IRS) to help individuals comply with U.S. tax laws. It is used for tax purposes only and does not authorize employment in the U.S. or provide eligibility for Social Security benefits.
Understanding the Structure of an ITIN
The structure of an ITIN is designed to be distinct from an SSN. An SSN is a nine-digit number issued by the Social Security Administration and typically follows a format of XXX-XX-XXXX. In contrast, an ITIN always starts with the number 9. This initial digit serves as a clear identifier that the number is an ITIN and not an SSN. The subsequent digits are assigned sequentially. The middle two digits (after the initial 9) range from 50 to 88, or 70 to 88 for tax years 2013 and later. The final four digits are unique to the individual.
For instance, an ITIN issued in 2013 or later might appear as 9XX-7X-XXXX, where 'XX' represents the middle digits and 'XXXX' represents the last four digits. Before 2013, the middle digits ranged from 00 to 79. This change in the middle digits was implemented to manage the ITIN inventory and ensure a sufficient supply of numbers. Understanding the specific range of the middle digits can help you ascertain the approximate year an ITIN was issued, although the primary identifier remains the leading '9'. The question "itin starts with what number" is directly answered by this structure: it's always 9.
Who Needs an ITIN?
An ITIN is required for various tax-related situations for individuals who cannot obtain an SSN. This includes:
- Non-resident aliens filing U.S. tax returns: If you are a non-resident alien and have U.S. source income that requires you to file a federal tax return (such as Form 1040-NR), you will likely need an ITIN. This applies even if you are not physically present in the U.S. during the tax year.
- Dependents and beneficiaries: U.S. citizens or resident aliens who are married to non-residents or are parents of non-resident dependents may need to obtain an ITIN for these individuals if they are claimed on a U.S. tax return and do not have an SSN.
- Individuals filing certain tax forms: Certain tax forms require a U.S. taxpayer identification number. For example, if you are required to file Form 5472 to report transactions with a U.S. LLC that you own, and you do not have an SSN, you will need an ITIN. This is common for foreign owners of U.S. entities.
- Individuals claiming tax treaty benefits: If you are a non-resident alien who is eligible for tax treaty benefits (e.g., reduced withholding rates on certain U.S. income) and you wish to claim these benefits at the time income is paid, you generally must provide an ITIN to the withholding agent.
- Spouses and dependents of U.S. military personnel: While generally eligible for SSNs, there can be specific circumstances where an ITIN is necessary.
It's important to note that an ITIN is not a substitute for an SSN. It does not grant the right to work in the U.S. or provide eligibility for Social Security benefits. It is solely for federal tax reporting purposes. If you are eligible for an SSN, you should apply for one through the Social Security Administration instead of an ITIN.
How to Obtain an ITIN
To get an ITIN, you must file Form W-7, Application for IRS Individual Taxpayer Identification Number. You can apply for an ITIN in one of three ways:
- Mail the application to the IRS: You can mail your completed Form W-7, along with original or certified copies of your identification documents and a U.S. federal tax return (or other tax documentation as applicable), to the IRS address listed on the Form W-7 instructions. The IRS will review your application and mail you your ITIN. This process can take several weeks.
- Apply through a Certified Acceptance Agent (CAA): A Certified Acceptance Agent (CAA) is an individual or entity authorized by the IRS to help taxpayers apply for ITINs. CAAs can verify your original identification documents and forward your application to the IRS. This can often expedite the process and eliminates the need to send original documents to the IRS. Many individuals and businesses utilize the services of a CAA to streamline the ITIN application process, including those who use itin.net for their ITIN needs.
- Visit an IRS Taxpayer Assistance Center (TAC): Some IRS Taxpayer Assistance Centers offer ITIN application services by appointment. You will need to bring your completed Form W-7, original identification documents, and a U.S. federal tax return to your appointment. Appointment availability can be limited, and you must call to schedule one.
When applying, you must submit proof of identity and foreign status. Acceptable documents include a valid passport, national identity card, birth certificate, or driver's license. A passport is generally the preferred document as it satisfies both identity and foreign status requirements. If you submit a passport, you do not need to submit any other documents. If you do not have a passport, you will need to submit a combination of other documents that prove both your identity and your foreign status. The IRS provides a list of acceptable documents in the Form W-7 instructions.
Processing Times and Delays
The IRS generally processes Form W-7 applications within 7 to 10 weeks from the date they are received. However, processing times can fluctuate significantly, especially during peak tax seasons or due to backlogs at the IRS. If you apply by mail, you will not receive your ITIN until your application is processed. If you are applying through a Certified Acceptance Agent (CAA), they can often provide a quicker turnaround for the initial review and submission, but the IRS still controls the final issuance time.
Delays can occur for several reasons:
- Incomplete application: Missing information on Form W-7, such as an incorrect or missing SSN (if applicable), incorrect name, or missing supporting documentation, will cause delays. The IRS will typically send you a notice (like CP-48) if there are issues with your application.
- Unacceptable documentation: If the identification documents submitted are not valid, expired, or do not meet the IRS requirements for proving identity and foreign status, the application will be rejected. Sending certified copies instead of originals (unless certified by the issuing agency) can also lead to rejection.
- Tax return errors: If the ITIN application is tied to a tax return, any errors or omissions on the tax return itself can delay the processing of the Form W-7. The tax return must be complete and accurate.
- High volume: During tax season (January through April), the IRS receives a very high volume of ITIN applications, which can significantly extend processing times. It is advisable to apply well in advance of any tax deadlines.
If you are concerned about processing times, especially if you need your ITIN for an urgent tax filing or other specific purpose, consider using the services of a Certified Acceptance Agent. They can help ensure your application is complete and submitted correctly, potentially reducing the chance of delays.
ITIN Renewal Requirements
Not all ITINs expire. However, the IRS has implemented a renewal program for ITINs that have not been used on a federal tax return for three consecutive tax years. Additionally, ITINs with middle digits between 70 and 88 that were issued before 2013, and ITINs with middle digits between 50 and 69 that were issued before 2013, are subject to expiration and renewal. The IRS typically announces which ITINs need to be renewed each year. If your ITIN falls into these categories and has not been used recently, you may need to renew it.
The renewal process is similar to the initial application process. You will need to file Form W-7 again, along with updated identification documents and a U.S. federal tax return for the year you are claiming. You can apply for renewal by mail, through a Certified Acceptance Agent, or at an IRS TAC. The IRS will not automatically renew your ITIN; you must actively apply for renewal.
It is crucial to keep track of your ITIN's status and renewal requirements. An expired ITIN cannot be used for tax filing purposes. If you discover your ITIN has expired, you will need to go through the renewal process before you can file your taxes or claim any tax benefits that require an ITIN. This is particularly important if you are planning to form a U.S. LLC and will need an ITIN to file Form 5472 for reporting purposes. If you are unsure whether your ITIN needs renewal, you can contact the IRS directly or consult with a tax professional.
Common Mistakes When Applying for an ITIN
Applying for an ITIN involves several steps, and common mistakes can lead to significant delays or outright rejection of your application. Understanding these pitfalls can help you ensure a smoother process.
- Missing or incorrect identification documents: The most common error is submitting incorrect, expired, or insufficient identification documents. Remember, a passport is the only document that satisfies both identity and foreign status. If you don't have a passport, you must provide two separate documents that prove both. Ensure all documents are valid and clearly legible.
- Not including a U.S. tax return: For most applicants, Form W-7 must be submitted with a valid U.S. federal income tax return. If the tax return is incomplete, contains errors, or is not the correct form (e.g., filing a Form 1040 instead of 1040-NR when you are a non-resident), the IRS will likely reject the Form W-7. Ensure your tax return is accurate and complete before submitting it with your ITIN application.
- Incorrect personal information: Errors in your name, address, date of birth, or foreign address on Form W-7 can cause problems. Ensure this information exactly matches your identification documents. Any discrepancies must be explained or resolved.
- Failing to use a Certified Acceptance Agent (CAA) correctly: While CAAs can simplify the process, errors can still occur. Ensure you are working with a reputable CAA and that they are properly verifying your documents and forwarding your application. Using a service like itin.net can help ensure this process is handled correctly.
- Not understanding when an ITIN is required: Some individuals apply for an ITIN when they are actually eligible for an SSN, or when an ITIN is not necessary for their specific situation. Always confirm your eligibility and requirement before applying.
- Sending original documents without certification: If you are not using a CAA and are not submitting a passport, the IRS instructions generally require you to send original documents or certified copies from the issuing agency. Sending photocopies that are not certified by the issuing agency will likely result in rejection. Many individuals prefer to use a CAA to avoid the risk of losing original documents in the mail.
Reviewing the Form W-7 instructions thoroughly and double-checking all information before submission is critical. If you are unsure about any aspect of the application, seeking assistance from a tax professional or a Certified Acceptance Agent is highly recommended.
ITIN vs. EIN: Key Differences
It is important to distinguish an ITIN from an EIN (Employer Identification Number). While both are taxpayer identification numbers issued by the IRS, they serve entirely different purposes and are for different entities.
- ITIN (Individual Taxpayer Identification Number): As discussed, this is for individuals who are not eligible for an SSN but need a U.S. tax ID. It is used for personal income tax filings, claiming dependents, and other individual tax-related matters. An ITIN always starts with the number 9.
- EIN (Employer Identification Number): This is a nine-digit number assigned by the IRS to business entities operating in the U.S. for tax identification purposes. It is required for businesses such as corporations, partnerships, LLCs (that are taxed as corporations or partnerships), and sole proprietorships with employees. An EIN is also required for certain other entities, like estates and trusts. You apply for an EIN by submitting Form SS-4, Application for Employer Identification Number. An EIN does not start with a 9; its structure is different and does not have a fixed starting digit like the ITIN.
Many foreign nationals who are setting up a business in the U.S., such as a U.S. LLC, will need both an ITIN (for their personal tax filings related to the business income or if they are required to file Form 5472) and an EIN (for the business entity itself). The process for obtaining an EIN is separate from the ITIN application. Businesses often require an EIN to open a U.S. bank account or to operate legally within the United States. The process for obtaining an EIN can be done online, by mail, or by fax, and is generally faster than the ITIN application process. You can learn more about obtaining an EIN on our /ein page.
When to Seek Professional Assistance
While the IRS provides instructions for applying for an ITIN, the process can be complex, especially for individuals unfamiliar with U.S. tax laws or who have unique circumstances. Seeking professional assistance can save time, prevent errors, and ensure that your application is processed smoothly.
Consider seeking help if:
- You are unsure about your eligibility: If you are uncertain whether you need an ITIN or an SSN, or if you qualify for an ITIN, a tax professional can clarify your situation.
- Your identification documents are complex: If you have unusual or difficult-to-obtain identification documents, a professional can advise on what is acceptable.
- You need to file complex tax returns: If your U.S. tax situation is complicated, involving foreign income, tax treaties, or business ownership, a tax advisor can help prepare your return correctly, which is essential for your ITIN application.
- You are applying for an ITIN for multiple family members: Coordinating applications for several individuals can be challenging. A professional can manage the process efficiently.
- You want to use a Certified Acceptance Agent (CAA): While CAAs are trained to help, choosing a reputable and experienced CAA is important. Services like itin.net offer expert guidance through the CAA process.
- You need to open a U.S. bank account or form a U.S. LLC: Often, obtaining an ITIN is a stepping stone to other U.S. business activities. Tax and business advisors can help with the entire setup process, including obtaining an EIN and setting up your business structure. You can explore /llc for U.S. LLC formation and /bank-account for U.S. bank account opening information.
Consulting with a qualified tax professional or a Certified Acceptance Agent can provide peace of mind and help you navigate the intricacies of the U.S. tax system effectively. For more information about ITIN specialists, you can visit our /about page.