Gokce Tandogdu
ITIN Specialist, itin.net
An Individual Taxpayer Identification Number (ITIN) is issued by the Internal Revenue Service (IRS) to individuals who are required to have a U.S. taxpayer identification number but do not have, and are not eligible to obtain, a Social Security number (SSN). This means that if you are a foreign national or a non-resident alien who needs to file a U.S. tax return or is otherwise required to have a U.S. tax ID for federal tax purposes, and you cannot get an SSN, you likely need an ITIN. The question of who gets an ITIN is broad, as it covers many scenarios for foreign individuals interacting with the U.S. tax system. Many people searching for "who gets an itin" discover they fall into specific categories defined by the IRS for ITIN eligibility. These categories primarily relate to tax filing obligations or specific exceptions to those obligations.
Who is Eligible for an ITIN?
Eligibility for an ITIN is determined by your need to comply with U.S. tax laws and your ineligibility for an SSN. The IRS has established several categories of individuals who qualify. The most common reasons for needing an ITIN are:
- Filing a U.S. Federal Tax Return: This is the most frequent reason individuals apply for an ITIN. If you are a non-resident alien with U.S. source income that requires you to file a U.S. income tax return (such as Form 1040-NR), you will need an ITIN. This includes individuals who earn income from U.S. employment (even if working remotely for a U.S. company from abroad), have U.S. rental property income, or have other U.S. business income.
- Claiming Tax Treaty Benefits: Some non-resident aliens may be eligible for reduced or zero withholding tax rates on certain types of U.S. income, such as dividends, interest, or royalties, under an income tax treaty between the U.S. and their home country. To claim these benefits on a Form 1042-S (Foreign Person's U.S. Source Income Subject to Withholding), you generally need an ITIN. Without it, the payer of the income may be required to withhold tax at the highest applicable rate.
- Filing a U.S. Tax Return as a U.S. Resident Alien: While most U.S. resident aliens are eligible for an SSN, some individuals who are classified as resident aliens for tax purposes (due to meeting the substantial presence test or the green card test) but cannot obtain an SSN for specific reasons may be eligible for an ITIN. This is less common.
- Dependents or Other Dependents Claimed on a Tax Return: If you are filing a U.S. tax return and claiming a dependent who is a U.S. citizen or resident alien but does not have an SSN (e.g., a newborn U.S. citizen child whose parents are foreign nationals living abroad), that dependent will need an ITIN to be claimed on your return.
- Spouse or Dependent of a U.S. Citizen or Resident Alien: Similarly, if your spouse or a dependent is eligible to be claimed on your U.S. tax return, and they do not have an SSN, they will need an ITIN.
- Non-Resident Alien Spouse Filing a Joint Return: In certain circumstances, a non-resident alien spouse may choose to be treated as a U.S. resident alien for tax purposes to file a joint return with their U.S. citizen or resident alien spouse. To do this, both spouses must have valid SSNs or ITINs. If the non-resident alien spouse does not have an SSN, they will need to apply for an ITIN.
- Students, Scholars, or Researchers: Individuals on F, J, M, or Q visas who are in the U.S. for study, teaching, or research often have U.S. source income (e.g., stipends, grants, wages) and may need to file U.S. tax returns. They typically require an ITIN unless they are eligible for an SSN through employment.
It is important to understand that an ITIN is solely for federal tax reporting and identification purposes. It does not authorize an individual to work in the United States, nor does it provide eligibility for Social Security benefits. It also does not confer any immigration status.
Who Does Not Get an ITIN?
Individuals who are eligible for and have been issued a Social Security number (SSN) do not need an ITIN. The Social Security Administration (SSA) issues SSNs to U.S. citizens, permanent residents (green card holders), and certain non-immigrant visa holders authorized to work in the U.S. If you fall into any of these categories, you should obtain an SSN instead of an ITIN.
Furthermore, individuals who do not have a U.S. tax filing requirement and are not otherwise required by IRS regulations to obtain a U.S. taxpayer identification number do not need an ITIN. For example, a foreign national living and working entirely outside the U.S. with no U.S. source income, no U.S. investments, and no U.S. business dealings generally would not need an ITIN.
Special Situations: U.S. Business Owners and Investors
Foreign nationals who own or invest in U.S. businesses often encounter situations where an ITIN is necessary. This is particularly true for those who establish a U.S. LLC or other business entities.
- U.S. LLCs and Form 5472: If you are a foreign individual who owns a single-member U.S. LLC (disregarded entity for tax purposes), you are required to file Form 5472, Information Return of a U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business, along with a pro forma Form 1120 (U.S. Corporate Income Tax Return). This filing requirement is triggered by certain reportable transactions between the LLC and its foreign owner. To file these forms, you will need an ITIN. Without an ITIN, you cannot complete the required tax filings, and the IRS may impose significant penalties, such as the $25,000 penalty for failing to file Form 5472.
- Opening a U.S. Bank Account: While not all banks require an ITIN to open a business bank account for a U.S. entity like an LLC, many do. An ITIN can serve as a valid identification number for non-resident aliens when establishing a U.S. bank account, especially for entities that do not have an Employer Identification Number (EIN). Some banks may prefer an EIN for business accounts, but an ITIN can be a viable alternative or a necessary document for the individuals associated with the entity. For instance, some newer fintech banks catering to international entrepreneurs might use an ITIN in conjunction with the LLC's formation documents. If you plan to open a U.S. bank account for your business, research the specific requirements of the bank. Some popular options for international founders include Mercury, Relay, and Brex, each with its own set of documentation requirements.
- Obtaining an EIN: If your U.S. business needs an EIN (e.g., if you have employees in the U.S., are taxed as a corporation, or have specific retirement plans), you can apply for one using Form SS-4. A foreign individual applying for an EIN for their business does not necessarily need an ITIN beforehand, but they will need a U.S. address (which can be a third-party mail forwarding service or a registered agent's address) and a responsible party who can be identified. However, if the business activity itself generates U.S. source income requiring a tax return for the individual owner, an ITIN will eventually be needed. Applying for an EIN can be done directly with the IRS or through services like itin.net. You can find more information about obtaining an EIN on our /ein page.
What Documents Are Needed for an ITIN Application?
To apply for an ITIN, you must submit Form W-7, Application for IRS Individual Taxpayer Identification Number, along with original or certified copies of required identification documents and your U.S. federal income tax return (or documentation supporting an exception). The primary identification documents the IRS accepts are:
- Passport: This is the most commonly used document as it proves both identity and nationality. If your passport is expired, it can still be used if it was valid when issued and expired within the last 10 years.
- National Identity Card: A card containing your photograph, name, address, date of birth, and expiration date.
- U.S. Driver's License: A valid driver's license issued by a U.S. state or territory.
- Foreign Driver's License: A driver's license issued by a foreign country, provided it contains the required information.
- Foreign Military Identification Card: A military ID card issued by the applicant's country of affiliation.
- Visa: A valid visa issued by the U.S. Department of State that contains your name, photograph, and expiration date.
- U.S. State Identification Card: An ID card issued by a U.S. state or territory.
- Foreign Voters' Registration Card: A registration card from your country of origin.
- Civil Birth Certificate: A birth certificate showing the applicant's name, date of birth, place of birth, and parents' names.
- Medical Records (Dependent Only): For dependents under 6 years old, a medical record can be used if it includes the child's name, date of birth, place of birth, and parents' names.
- School Records (Dependent Only): For dependents under 18 years old, a school record can be used if it includes the child's name, date of birth, place of birth, and parents' names.
If you are applying based on a tax return, the return must be complete and accurate. If you are applying under an exception category (e.g., not filing a tax return but need an ITIN for other reasons like treaty benefits or reporting requirements), you must provide the specific documentation required for that exception category, as detailed in the Form W-7 instructions.
How to Apply for an ITIN
There are three primary ways to apply for an ITIN:
Mail Your Application Directly to the IRS: You can mail your completed Form W-7, tax return, and original or certified copies of your identification documents to the IRS address listed in the Form W-7 instructions. The IRS will review your application, assign you an ITIN, and mail the documents back to you. This process can be lengthy, and you risk losing original documents in the mail.
Apply Through a Certified Acceptance Agent (CAA): A Certified Acceptance Agent (CAA) is an individual or entity authorized by the IRS to assist taxpayers in obtaining ITINs. CAAs can verify your original identification documents and forward your application to the IRS on your behalf. This is often a preferred method because you can usually get your original documents back the same day. itin.net is an example of a service that can help you connect with a Certified Acceptance Agent or provide direct application assistance. Applying through a CAA can streamline the process and offer peace of mind. You can learn more about our ITIN application services on our / page.
Visit an IRS Taxpayer Assistance Center (TAC): Some IRS Taxpayer Assistance Centers offer ITIN application services by appointment. You must schedule an appointment in advance. You can bring your original documents to the TAC, where an IRS employee will verify them and forward your application. However, TACs do not issue ITINs; the IRS processing center does. Appointment availability can be limited.
Regardless of the method chosen, the application process involves submitting the correct forms, supporting documentation, and a tax return (or exception documentation). Accuracy and completeness are key to avoiding delays.
ITIN Processing Times and Fees
There is no fee to apply for an ITIN directly with the IRS or through a CAA. The IRS processes ITIN applications. Processing times can vary significantly depending on the volume of applications the IRS receives.
- Standard Processing: During normal periods, it can take the IRS anywhere from 7 to 11 weeks to process an ITIN application submitted by mail. If applying through a CAA, you may receive your documents back sooner, but the IRS still needs to process the application. The actual ITIN assignment can take several additional weeks after your documents are returned.
- Peak Seasons: During tax season (typically January through April), processing times can extend. The IRS advises allowing up to 11 weeks or more during these busy periods.
- Expedited Processing: Expedited processing is generally not available for ITIN applications unless there is a documented urgent need related to a tax return deadline. This is rare and requires specific IRS approval.
It is crucial to apply well in advance of any tax deadlines to allow ample time for processing. If you are filing a tax return that requires an ITIN, ensure your application is submitted at least 10-12 weeks before the filing deadline.
Common Mistakes When Applying for an ITIN
Several common mistakes can lead to delays or rejections of ITIN applications. Being aware of these can help ensure a smoother process:
- Incomplete Form W-7: Failing to fill out all required fields on Form W-7, or providing inaccurate information, is a primary reason for delays. Ensure all names, addresses, and identification numbers are correct and match your supporting documents.
- Missing or Incorrect Identification Documents: Not including the required identification documents, or submitting photocopies instead of original or certified copies, will cause your application to be rejected. If mailing original documents, ensure they are protected and sent via a trackable method. If using a CAA, understand their document verification process.
- Incorrect Tax Return: If applying with a tax return, ensure it is the correct version (e.g., 1040-NR for non-resident aliens), fully completed, and signed. An incomplete or incorrect tax return will hold up the ITIN application.
- Not Providing a Valid U.S. Address: While you don't need to be a U.S. resident to get an ITIN, you do need a valid mailing address to receive correspondence from the IRS. This can be a friend's address, a relative's address, or a mail forwarding service. Using a PO Box may not be acceptable for all purposes.
- Failure to Follow Instructions: The IRS provides detailed instructions for Form W-7 and the ITIN application process. Not reading and following these instructions carefully is a frequent cause of errors.
- Applying for an ITIN When Eligible for an SSN: If you are eligible for an SSN, you must obtain that instead. The IRS will reject an ITIN application if they determine you are eligible for an SSN. Make sure you have explored all options for obtaining an SSN before applying for an ITIN.
ITIN Renewal and Expiration
An ITIN does not expire. However, the IRS has implemented a policy where ITINs that have not been used on a federal tax return for three consecutive tax years are deactivated. Additionally, the IRS has begun requiring renewal for ITINs with the first four digits ending in 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, or 83. These specific ITINs must be renewed to be valid for tax filing purposes. If your ITIN falls into one of these categories or has been deactivated due to non-use, you will need to go through a renewal process, which is similar to the initial application process (submit Form W-7, identification documents, and a tax return).
Getting Help with Your ITIN Application
Applying for an ITIN can seem complex, especially when dealing with the IRS and providing sensitive personal documents. The IRS offers resources, and professional assistance is available.
- IRS Resources: The IRS website provides publications and forms related to ITINs. The instructions for Form W-7 are particularly helpful.
- Certified Acceptance Agents (CAAs): As mentioned, CAAs can verify your documents and help you submit your application. Using a CAA like those associated with itin.net can simplify the process significantly and reduce the risk of errors. This is often the most efficient and secure way to apply, especially for those living abroad.
- Tax Professionals: Experienced tax professionals, particularly those specializing in international taxation, can provide guidance on whether you need an ITIN, help you understand your U.S. tax obligations, and assist with the application process. For complex situations involving U.S. business ownership, investment, or significant U.S. income, consulting with a qualified professional is highly recommended. You can also reach out to us via our /contact page for assistance.
Understanding the specific requirements and categories for who gets an ITIN is the first step in successfully complying with U.S. tax laws as a foreign national. Whether you need an ITIN for personal tax filing, claiming treaty benefits, or for business purposes like establishing a U.S. LLC and filing Form 5472, ensuring you have the correct documentation and follow the IRS procedures is paramount.