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What is a Tax Identification Number (TIN)?
During a tax year in the USA, many people fill in and file different documents on tax-related matters. Everyone should have a unique number so that these documents do not get mixed up. This number is the tax identification number and helps to distinguish you from other people. This post can guide you to what a tax identification number is, types of tax identification numbers, and where to get one.
A tax identification number is a unique 9-digit number that individuals or businesses should use when submitting their tax returns or submitting other tax-related documents to the IRS. It is a number used to identify you. These numbers serve to identify individuals and businesses. The tax identification number is actually a general term and there are several types. The Tax Identification Number is issued by the IRS or Social Security Administration (SSA). The Social Security Number (SSN) is issued by the Social Security Administration. Other tax identification numbers are issued by the IRS.
Tax Identification Number Types
Tax Identification Number is used to identify individuals or businesses. The tax identification number is a generic name. There are five types of this tax identification number. These are the types of tax identification you should have, depending on your situation. First you need to determine which one you need. In this section, we will talk about the types in detail.
- Social Security Number (SSN)
- Employer Identification Number (EIN)
- Individual Taxpayer Identification Number (ITIN)
- Adoption Taxpayer Identification Number (ATIN)
- Preparer Taxpayer Identification Number (PTIN)
Social Security Number (SSN)
The social security number (SSN) is a 9-digit number in the form XXX-XX-XXXX. It helps to record your wages or self-employment earnings accurately by the Social Security Administration. You also need this number to get government services, to find a job, and to collect Social Security benefits. You can find this number on your social security card. This number is a number assigned to US citizens, permanent residents, and temporary (working) residents.
How to obtain: If you want to get a Social Security Number, you need to fill in Form SS-5. Form SS-5 is a Social Security Card application form. In some regions, you can apply for a card online. Unlike other numbers, it is a number given by the Social Security Administration. In addition, you must provide evidence of age, identity, US citizenship, or foreign legal status. In other words, a social security number is given by the Social Security Administration.
Employer Identification Number (EIN)
The employer identification number is also known as a federal tax identification number. It is a number given to employers, commercial organizations, companies, businesses, self-employed persons, sole proprietors, LLCs, and government agencies in order to file a tax return or for other tax-related situations. It is a number used to identify employers and business organizations. It is a 9-digit number that looks like XX-XXXXXXX.
Usually, you may need to apply for a new EIN when the ownership or structure of your business changes.
How to obtain it: If you want to obtain an employer identification number, you can use the IRS Form SS-4. This number is provided free of charge by the IRS. You can apply online, by fax, or by mail. Those who wish to apply for the number must have a valid SSN, ITIN, or EIN. If your main business is located in the USA, you can also apply online. The online application can be a quick and easy method for you.
In other words, individuals can use their Social Security Numbers (SSN) individually. However, businesses must use the Employer Identification Number (EIN). SSN, provided by the social security administration. The EIN is provided by the IRS.
Individual Taxpayer Identification Number (ITIN)
U.S. federal taxpayers are required to obtain a tax identification number, a Social Security Number, for tax purposes. In cases where individuals cannot obtain a Social Security Number, they must obtain an Individual Tax Identification Number (ITIN). In other words, ITIN is a 9-digit number (in the form of XXX-XX-XXXX) received by people who do not have a Social Security Number (SSN) or are not entitled to receive it. That is, it is a number received only for certain non-resident foreigners, resident foreigners, their spouses, or dependents who cannot obtain an SSN.
How to obtain: You can obtain the individual taxpayer identification number by filling out IRS Form W-7. Each individual who wishes to apply for an IRS Form W-7 is also required to provide documentation confirming their foreign status and identity. You can mail the documents and your application to the relevant address, submit them to the offices of the IRS, or process them through an authorized admissions agent. You can also use this form to change your expired individual taxpayer identification number.
Admissions Representative
If you want to obtain an ITIN, you can consult admissions representatives such as accounting firms or financial institutions to assist you. Admissions representatives review your documents and send the completed forms to the IRS.
Adoption Taxpayer Identification Number (ATIN)
It is a number assigned to the child to be adopted when a taxpayer seeking adoption cannot obtain an SSN for a US citizen or resident child. It is a temporary number. After the adoption process is complete, the adopter must obtain an SSN number for the child and notify the IRS of this. Otherwise, this number will be disabled within two years. For detailed information, you can refer to the official website of the IRS.
How to obtain: You can obtain this number by filling out the IRS Form W-7A. To use Form W-7A, the child must be a US citizen or resident.
Preparer Taxpayer Identification Number (PTIN)
Anyone who prepares or helps prepare a federal tax return must obtain a Preparer Taxpayer Identification Number (PTIN) before filing documents. In these prepared documents, a valid PTIN must be used.
How to obtain: If you are a tax preparer, you can get this number online with the IRS online registration system. Getting a number online takes up to 15 minutes and can be a quick and easy method for you. If you want, you can also get it on paper by filling out the IRS Form W-12. But it can be a long road, processing can take between 4 and 6 weeks.
What is an Exemption Request for a Dependent or Spouse?
If your dependents or spouse do not have a Social Security Number and are not eligible to receive an SSN, you should list the ITIN instead of the SSN. You must list the social security number (SSN) of any person you are applying for an exemption on your personal income tax return. Also, you will not need a Social Security Number or ITIN for a child born and died within the same tax year.
Form W-8 BEN
Form W-8 BEN must contain your US or foreign identification number. You must give Form W-8 BEN to the withholding agent or payer if you are a foreign person and you are the beneficial owner of an amount subject to withholding. So do not send this form to the IRS. This form is for use by individuals. Legal entities are required to use Form W-8 BEN-E.
Bottom Line
You must provide a valid tax identification number on your tax returns and tax-related documents. Also, if you want to apply for tax benefits, you must have a Tax Identification Number. There are a lot of people who file their tax returns and they need a number to identify them so that the documents they give are not confused. The tax identification number is used to identify individuals or businesses. There are five different types. The SSN is issued by the Social Security Administration. All other tax identification numbers are provided by the IRS.
*This document should not be assumed as a legal advice. This information is subject to change, please make contact with our team of attorneys to confirm.
References:
https://www.irs.gov/individuals/international-taxpayers/taxpayer-identification-numbers-tin
https://www.irs.gov/businesses/small-businesses-self-employed/employer-id-numbers
