A Tax Identification Number (TIN) is a nine-digit tracking number assigned and used to identify a taxpayer. If you receive income or have any reportable or taxable activity (in the case of an entity or business), the government expects you to pay taxes on it. To do so, the IRS requires that you first provide a tax identification number.
A Social Security number is a form of TIN used by most taxpayers when filing their federal and state taxes. A TIN is also required for non-tax purposes, such as opening a bank account, applying for a loan, applying for a job, buying or renting property, and claiming government benefits.
Other types of tax identification numbers
Individual Tax Identification Number (ITIN)
If an occupant or alien outsider (or their mate or ward) isn’t qualified for a Social Security number, they are given a nine-digit Individual Taxpayer Identification Number (ITIN). This is similar to a regular nine-digit TIN, but to obtain it, the person must present Form W-7 and documents that prove their resident status.
Employer Identification Number (EIN)
The Employer Identification Number (EIN) is the TIN issued to corporations, nonprofit organizations, estates, trusts, and any other businesses that are required to pay taxes. This number is used when reporting annual income for taxes.
The IRS offers a list of yes or no questions to help you determine if you need an EIN.
How to obtain a tax identification number?
The IRS offers information on how to apply for different tax identification numbers.
Individual Taxpayer Identification Number: Complete IRS Form W-7, IRS Application for Individual Taxpayer Identification Number. You must submit your resident or nonresident alien documentation with Form W-7. You can mail the material, take it to an IRS office, or send it through an IRS-authorized Acceptance Agent.
Employer Identification Number – There are several ways to apply for an EIN, including online, by fax, by mail, and by phone.
How long does the ITIN take?
The time to acquire an ITIN number can be approximately up to six weeks, taking into account that this period is outside the period of maximum demand, which is between January and April.
Additionally, original documents or certified copies for ITIN applications will be returned within 65 days.
If in this period of time, users do not receive their original documents back, they can notify the Internal Revenue Service (IRS) by mail.
Similarly, they could contact the telephone line 1-800-908-9982.
When can I renew the ITIN number?
For those users or taxpayers who have issued ITINs and are on the verge of their expiration date, they can immediately submit their request for the relevant renewal.
Therefore, it is not necessary to wait for a notice from the IRS.
Additionally, taxpayers must wait seven weeks from the date they mail Form W-7 for the IRS to notify them of the status of their ITIN number application.
On the other hand, the wait is nine to eleven weeks if you submit your request during periods of high demand, or if it is submitted by the user from abroad.
Who can get an ITIN number?
- Nationals in their foreign status, which are not eligible for Social Security Numbers. But who are required to report federal taxes in the USA or who want to obtain an EIN.
- Nonresident aliens who cannot be approved for an SSN. Which, must introduce tax returns in the USA for their respective refunds.
- Resident foreigners who declare tax refunds.
- Dependents of US citizens or foreign nationals who have duties to the federal tax systems.
- The spouses of non-resident foreigners who are on a visa, who must report taxes.