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  • 1. I ndividual T ax I dentification N umber (ITIN) – ITIN Program Office Atlanta, GA
  • 2. An ITIN does NOT ...
    • Entitle the recipient to Social Security benefits or Earned Income Tax Credit (EITC); but, may be eligible for CTC and ACTC
    • Create an inference regarding the individual’s immigration status
    • Give the individual the right to work in the U.S.
  • 3. Reasons for Form W7
    • Should not apply for an ITIN if eligible for a SSN
    • Form W-7 (Application for an ITIN) has 8 “reasons for applying” that are listed as boxes a through h
    • Four commonly used by the immigrant population – boxes b, c, d, e
  • 4. An ITIN is required if you are...
    • A nonresident alien filing a U.S. tax return and not eligible for a SSN (Reason b on W-7)
    • A U.S. resident (based on the days present in the United States) filing a U.S. tax return and not eligible for a SSN (Reason c on W-7)
  • 5. An ITIN is required if you are ….
    • A dependent of U.S. citizen/resident alien (Reason d on W-7)
    • A * nonresident spouse being shown on a tax return as an exemption (Reason e on W-7)
    • * resident spouse, too.
  • 6. Substantial Presence Test
    • Determines if the applicant is a resident or nonresident for tax purposes
    • Determines which box to mark on Form W-7 for “reason for applying” – Reason b or c
    • Needs dates for the applicant’s entrance to the U.S. and for any subsequent travel outside the U.S.
  • 7. Substantial Presence Test
    • If the client meets the substantial presence test, the client is considered to be a resident for tax purposes and qualifies to file Form 1040 instead of Form 1040NR.
    • Test based on number of days the client has resided in the U.S.
    • Special rules apply for visa holders regarding days that can be counted as residing in the U.S.
  • 8. Substantial Presence Test
    • To meet the substantial presence test, the individual must be physically present in the U.S. for at least:
      • 31 days during the current year, and
      • 183 days during the 3-years that includes the current year and the 2 years immediately before that
  • 9. Substantial Presence Test
    • Counting:
      • All the days present in the current year , and
      • 1/3 of the days present in the first year before the current year , and
      • 1/6 of the days present in the second year before the current year
  • 10. Required ITIN Application Documentation should…
    • 1. Provide documentation to prove the applicant’s identity – contain the applicant’s name and a photograph
    • 2. Provide documentation to prove the applicant’s claim of foreign status
  • 11. ITIN Documentation
    • Documentation substantiating identity must be:
      • Originals , or
      • Copies Certified by the Issuing Agency or official custodian of the original record, or,
      • Copies Notarized by an U.S. Notary Public legally authorized within his or her local jurisdiction to certify that the document is a true copy of the original.
      • Copies Notarized by a Foreign Notary Public under the Hague Convention require an Apostille to be attached.
  • 12. Acceptable Documentation for ITIN application
    • Changed in December 2003 to 13 items
      • Passport
      • U.S. driver’s license
      • Civil birth certificate
      • * National identification card (must show photo, name, current address, date of birth, and expiration date)
      • * Canadian applicants can use: Permanent Residence Card or Certificate of Citizenship, both acceptable National ID
  • 13. Acceptable Documentation (cont.)
      • Foreign driver’s license
      • U.S. state identification card
      • Foreign voter’s registration card
      • U.S. military identification card
      • Foreign military identification card
  • 14. Acceptable Documentation (cont.)
      • Visa – an official authorization appended to a passport – not the credit card.
      • U.S. Citizenship and Immigration Services (USCIS) photo identification
      • Medical records (dependents only)
      • School records (dependents and/or students under 14 y/o only)
  • 15. Documentation
    • A valid passport is the only stand-alone document
    • If other documentation is provided, at least two forms of documentation need to be provided and one must be a photo identification
      • Exception for dependents under age 14 – no picture required
  • 16. Current Documents
    • Birth certificates do not contain expiration dates and are considered current.
    • If document has an expiration date, expiration date cannot have passed.
    • Medical records must be within 12 months of the current date (application date).
    • School records are current if date displayed on records is not more than one year prior to date application is submitted.
  • 17. School Records
    • Acceptable forms of school identification:
    • Student picture ID
    • Report card
    • Letter from school
    • Administrative record
  • 18. Documents in Foreign Language
    • Certified Translation should be provided
      • Signed and sealed by official performing the translation
      • Certifying the information on the foreign document
    • Attach certified translation and document in foreign language to the ITIN application
  • 19. Return attached?
    • New rules effective 12/17/03
    • Require a federal tax return to be attached to the W-7 application unless an exception is met
    • Exception needs to be documented
    • Four exceptions - two most commonly seen with immigrant community
  • 20. Exception 1
    • Passive Income – third party withholding
    • The applicant has an asset that generates income subject to information reporting OR withholding requirements
    • Example – interest bearing bank account
  • 21. Exception 1 - Documentation
    • Evidence that the applicant opened an account with a financial institution that he/she has an ownership interest in the account
    • Examples – bank statement
    • signature card
    • letter from bank – on letterhead
  • 22. Exception 2
    • Third Party Reporting – mortgage interest
    • Individual that has secured a home loan may seek an ITIN to provide to their lender – the lender reports mortgage interest on Form 1098
  • 23. Exception 2 - Documentation
    • Evidence of a home mortgage loan
    • Examples - loan commitment letter from the financial institution, a broker’s listing agreement, or similar documentation
  • 24. When to complete Form W-7
    • Exception met – as soon as exception is determined
    • No exception met – when next tax return is due to be filed
    • Delinquent returns – when delinquent returns are ready to be filed
  • 25. Common Application Errors
    • Application mailed to regular IRS Service Center instead of the ITIN group in Philadelphia (use address shown on W-7 instructions)
    • Using outdated Form W-7
    • Not showing an entry date into the U.S. when applicant is residing in the U.S.
    • Not signing Form W-7
  • 26. Common Application Errors
    • Name entries on Form W-7 not matching supporting documentation
    • Sending documents that have expired
    • Not marking one of the boxes for reason application is being submitted
    • Not entering birth date in MM/DD/YYYY format
    • Not showing foreign address on line 2
  • 27. Common Application Errors
    • Not attaching a tax return when required
    • Not attaching documentation for one of the exceptions when no return is attached
  • 28. Common Application Errors
    • Not having documentation properly notarized when originals are not sent
    • Not having foreign documents *translated or not attaching the foreign document
    • * Spanish may not need to be translated since PSC ITIN Unit may have bilingual employees.
  • 29. Other Information
    • If an extension for time to file or an estimated tax payment is sent prior to receiving the ITIN, write “ITIN to be requested” wherever the ITIN/SSN is requested. Extension is filed with Philadelphia ITIN Unit.
    • ITIN taxpayer address change – have taxpayer complete Form 8822 and mail to Philadelphia
    • ITIN taxpayer name change – have taxpayer notify ITIN unit and send appropriate documentation
  • 30. Acceptance Agent Program
    • Acceptance Agents are critical to the success of the ITIN program because of their close proximity and availability to those needing ITINs for tax purposes.
    • AAs can include educational institutions, financial institutions, government entities/military installations, volunteer organizations and tax practitioners.
    • If you are interested in becoming an AA please sign the mailing list and we will send you our application and information packet.
  • 31. Changes in the AA Program
    • Acceptance Agent Agreements expire December 31, 2005.
    • New Agreements will expire 4 years from the date signed.
    • Application Form 13551 is required to apply for the AA Program.
    • FBI Investigations (fingerprinting)
    • Compliance checks.
  • 32. Contact Information
    • Francine Prince
    • Chief, ITIN Program Office
    • 401 W. Peachtree St., NW
    • Mail Stop 97 WI
    • Atlanta, GA 30308
    • (404) 338-8963
    • [email_address]