ITIN vs. SSN: Which One Do You Need?

People often confuse the two numbers. An SSN and an ITIN look similar, but they are issued for different purposes, and an ITIN cannot do everything an SSN can.

The short version

An SSN is issued by the Social Security Administration. It is used for work, benefits, and taxes.
An ITIN (Individual Taxpayer Identification Number) is a tax processing number issued by the IRS. It is for people who must file or report U.S. taxes but don’t qualify for an SSN.

Who needs an ITIN

According to the IRS, an ITIN may be needed by:

Nonresident aliens who must file a U.S. return or want a refund
Resident aliens filing based on days present in the U.S.
Dependents claimed on a U.S. return
A spouse filing jointly with a U.S. citizen or resident
Foreign students, professors, or researchers filing returns
People claiming tax treaty benefits
People in certain real property transactions subject to withholding

What an ITIN can’t do

This is where people get tripped up. The IRS states an ITIN is “issued for federal tax purposes only”:

It doesn’t provide Social Security benefits.
It doesn’t make you eligible for the earned income credit.
It doesn’t indicate immigration status or work authorization.
It isn’t issued just to open a bank or investment account, run an e-commerce business, or start a business.

For employment, an ITIN also can’t replace an SSN. Employers need an SSN for the Form W-2.

How to apply

Complete Form W-7.
Provide identity documents that prove both identity and foreign status. The IRS requires originals or certified copies from the issuing agency. Notarized copies aren’t accepted.
Attach a federal tax return or other proof of a tax purpose.
Submit by mail, in person at an IRS Taxpayer Assistance Center (by appointment), or through a certified acceptance agent.

Processing usually takes about 7 weeks, and up to 11 weeks during peak season (January 15 to April 30) or when applying from abroad.

Expiration and renewal

An ITIN expires on December 31 of the third consecutive tax year in which it isn’t used on a return, either by the holder or as a dependent’s number. ITINs assigned before 2013 that were never renewed are also expired.

You can renew only if the ITIN has a federal tax filing purpose. Submit Form W-7 with a valid federal return and identity documents. If the ITIN won’t appear on a return soon, you don’t need to renew yet.

ITIN or EIN?

These are different. An EIN identifies a business, an ITIN identifies an individual. A foreign-owned LLC can get an EIN without the owner having an ITIN in many cases. See our EIN guide.

Next steps

Work out why you need the number. The reason decides the documents and timing.
Gather originals early, since you must send or present original documents.
Don’t wait until filing season if you can avoid it.

Need help working out whether you need an ITIN? Book a call with FlowTex.

Sources

This article is general information, not tax, immigration, or legal advice. Talk to a qualified professional about your situation.