ITIN Frequently Asked Questions

What is an ITIN and Who Needs it?

The acronym "ITIN" stands for Individual Taxpayer Identification Number." An ITIN is for individuals who have a U.S. tax filing requirement but are not eligible for a Social Security Number (SSN). Here's a list of potential people who might need an ITIN:


  • Nonresident Aliens who are required to file a U.S. tax return. This includes individuals with U.S. source income, even if they don't live in the U.S.


  • Resident Aliens (for tax purposes) who are required to file a U.S. tax return due to their substantial presence in the U.S. but do not qualify for an SSN.


  • Dependents or spouses of U.S. citizens or resident aliens who are claimed for an allowable tax benefit (like the Child Tax Credit or Credit for Other Dependents) and don't have an SSN.


  • Dependents or spouses of nonresident alien visa holders who are claimed for an allowable tax benefit and don't have an SSN.


  • Nonresident alien students, professors, or researchers filing a U.S. federal tax return or claiming a tax treaty benefit, especially if they receive taxable stipends or scholarships that are not considered wages.


  • Foreign investors who have U.S. income that requires tax reporting.


  • Individuals who are lawfully present in the U.S. but do not qualify for work authorization and therefore an SSN, yet have a tax filing obligation.


  • Individuals who earned income in the U.S. but don't owe tax or aren't required to file, but want to file to get a refund or refundable tax credit.


What is a Certifying Acceptance Agent and why should I work with one?

A Certifying Acceptance Agent (CAA) is an individual or entity authorized by the IRS to help foreign nationals and other individuals who do not qualify for a Social Security Number (SSN) obtain an Individual Taxpayer Identification Number (ITIN). Working with a CAA offers significant advantages:


  • Avoid Sending Original Documents: The most crucial benefit is that a CAA can verify and certify your original identification documents (like passports) on site. This means you do not have to mail your valuable original documents to the IRS, significantly reducing the risk of loss and eliminating the need to be without them for an extended period (which can be weeks or months).


  • Reduced Errors and Rejection Risk: CAAs are trained by the IRS on the specific requirements for ITIN applications. They can help you accurately complete Form W-7 and gather all necessary supporting documentation, greatly minimizing the chance of errors that could lead to delays or outright rejection of your application.


  • Streamlined Process: CAAs can submit your application directly to the IRS and often communicate with the IRS on your behalf regarding the status of your ITIN. This can expedite the process and provide peace of mind.


  • Expert Guidance: They possess in-depth knowledge of the ITIN application process and can answer your questions, ensuring you understand the requirements and implications of obtaining an ITIN.


What are the benefits of having an ITIN and are there any limitations?

Here are some key benefits of having an ITIN:


  • Tax Compliance: The primary benefit is that an ITIN allows individuals to comply with U.S. tax laws by enabling them to file federal income tax returns. This demonstrates adherence to legal obligations.


  • Claiming Tax Benefits: ITIN holders can often claim certain tax credits and deductions for which they qualify. This includes credits like the Child Tax Credit (if the child has an SSN), the Credit for Other Dependents, the American Opportunity Tax Credit, and the Premium Tax Credit. Filing a tax return with an ITIN is often necessary to receive these benefits or refunds.


  • Opening Bank Accounts: Many financial institutions allow individuals with an ITIN to open personal and even business bank accounts. This provides a safe place to store money, manage finances, and establish a financial history in the U.S.


  • Building Credit: Having a bank account and filing tax returns with an ITIN can contribute to building a financial history, which can be helpful for future credit applications (e.g., loans, credit cards) with ITIN-friendly lenders.


  • Proof of Residency and Work History: Filed tax returns with an ITIN can serve as a documented record of an individual's presence and work history in the U.S., which might be useful for various purposes, including some immigration processes in the future.


  • Purchasing Health Insurance: For individuals with an ITIN, filing taxes is often a requirement to purchase health insurance through the Health Insurance Marketplace and potentially qualify for the Premium Tax Credit, making health insurance more affordable.


  • Obtaining a Driver's License: Some states require an ITIN to apply for a driver's license. Check with your state for the most current regulations. 


Here is an important note:


  • An ITIN does not grant work authorization, change immigration status, or make one eligible for Social Security benefits or the Earned Income Tax Credit (EITC). It is solely for tax purposes.