A recurring line of rhetoric is that undocumented immigrants and non-U.S. citizens don’t pay taxes. While some undocumented workers get paid “under the table” for their work, many others do pay taxes. In fact, according to bipartisan research and advocacy organization New American Economy, foreign-born individuals pay nearly $224 billion in total federal tax contributions and $105 billion in total state and local tax contributions each year.
An individual taxpayer identification number (ITIN) is one of the tools that make those tax payments possible.
What Is an ITIN?
An ITIN is a processing number used on tax returns for people who don’t qualify for a Social Security number (SSN) but need to file a tax return.
According to the Social Security Administration, only noncitizens authorized to work in the U.S. can get an SSN. Immigrants can either apply for an SSN in their home country before coming to the U.S. or apply for one in person once they arrive in this country.
Most of the time, you need a Social Security number to file a U.S. tax return, but the requirement to pay taxes in the U.S. isn’t limited to people who can get an SSN. The tax code requires both “resident aliens” and “nonresident aliens” to file tax returns.
- Resident aliens are either green card holders or people with a “substantial presence” in the U.S. The IRS defines “substantial presence” as 1) being present in the U.S. for at least 31 days of the year, and 2) being in the U.S. at least 183 days within the last three years. Undocumented workers can fall into this category if they meet these two requirements. Resident aliens follow the same filing requirements as U.S. citizens.
- Nonresident aliens are anyone who doesn’t have a green card and doesn’t pass the substantial presence test. Nonresident aliens who own a business in the U.S. or have U.S. income but didn’t have enough tax withheld must file a U.S. tax return using Form 1040-NR.
The IRS created nine-digit ITINs to allow resident and nonresident aliens with a tax-filing requirement to pay the taxes they’re legally required to pay. It doesn’t provide legal immigration status, authorize someone to work in the U.S., or make the holder eligible for Social Security benefits. It’s simply used to process federal income tax returns and account for tax payments.
How to Get an ITIN
The first step to getting an ITIN is completing IRS Form W-7, Application for IRS Individual Taxpayer Identification Number.
In addition to a completed and signed Form W-7, you must provide documentation proving your identity and foreign status. The IRS’s list of acceptable documents includes:
- U.S. Citizenship and Immigration Services photo IDs
- Visas issued by the U.S. Department of State
- U.S. or foreign driver’s licenses
- U.S. or foreign military ID cards
- National ID cards containing the holder’s name, photograph, address, date of birth, and an expiration date
- U.S. state identification cards
- Foreign voter registration cards
- Civil birth certificates
- Medical records (for dependents under age 6)
- School records (for dependents under age 18), if a student
The IRS Instructions for Form W-7 state that you can apply by mail by sending the form, your tax return, and your original identity and foreign status documents. Just attach Form W-7 to the front of your return and leave the SSN area on your tax return blank.
However, mailing your return comes with a risk of having your documents get lost in the mail. It’s safer to either send certified copies of your documents or apply in person. The IRS requires that certified copies be “one that the original issuing agency provides and certifies as an exact copy of the original document and contains an official stamped seal from the agency.” For ITIN applications, the IRS doesn’t accept copies of documents that have been signed by a notary.
You can apply in person by visiting a designated IRS Taxpayer Assistance Center (TAC). You can find a list of TAC locations that offer an in-person review of Form W-7 documents on the IRS website. Note that service at TAC locations is by appointment only. You can schedule an appointment by calling 888-545-5640.
You can also get help applying for an ITIN in person at an IRS Volunteer Income Tax Assistance (VITA) location. The VITA program helps low-income and non-English-speaking taxpayers prepare their tax returns. However, not all VITA locations offer document-review services. You can locate a VITA office that offers ITIN help on the IRS website. Call the location ahead to make an appointment.
How Long Does It Take to Get an ITIN?
Once you submit your application and supporting documents, the IRS sends you a letter with your ITIN assignment within seven weeks. However, it can take longer if you apply for an ITIN during the peak tax-filing months of January through April.
Once the IRS approves your ITIN application, they process the tax return submitted with your ITIN application within six to eight weeks.
When Does an ITIN Expire?
Your ITIN remains valid as long as you file a federal income tax return at least once every three years. If you don’t use your ITIN within that time frame, you must renew it before filing a tax return again.
To renew your ITIN, you use the Form W-7 again but check the box for “Renew an Existing ITIN” on the top right-hand corner of the first page. You must resubmit the necessary documentation to prove your identity and foreign status.
To prevent your ITIN from expiring, notify the IRS when you change your address using Form 8822. That way, you won’t miss a notice from the IRS alerting you that your ITIN is about to expire.
The Institute on Taxation and Economic Policy estimates that at least 50% of undocumented immigrant households in the U.S. file tax returns using ITINs hoping that complying with the country’s tax laws will help them become citizens.
Many of the immigration reform bills floated over the past several years have included provisions like “good moral character” and “paying back taxes” as requirements for obtaining documented status. A history of paying taxes creates a paper trail to show when that person entered the U.S. and how long they’ve been contributing their tax dollars.
Have you applied for an ITIN? How long did it take the IRS to process your application?