Do you come in those who haven’t used their Individual Taxpayer Identification Number (ITIN) for filing federal tax returns since the last three consecutive years? Or your ITIN consists of middle numbers like 83, 84, 85, 86 or 87? In either of the cases, your ITIN is going to expire on 31st December 2019 and needs renewal as soon as possible.
Nearly 2 million U.S. taxpayer’s ITINs are going to expire at the end of this year and require early renewal to avoid delay in tax refunds in the 2019 tax season. ITINs are used by those people living in the U.S. who are obligated to pay US tax under the country’s tax laws but are not eligible for a Social Security Number.
The article will help you find ways to renew your ITIN and give you all the must-have information that might come handy while doing so.
Find out if you need to renew your ITIN
The IRS is taking widespread measures to get the information across to taxpayers to renew their ITINs before 31st December 2019. All taxpayers who do not have a Social Security Number (SSN) and use the Individual Taxpayer Identification Number (ITIN) for filing tax returns are required to submit renewal applications as soon as possible to avoid delay in tax refunds on their 2020 tax returns.
You can find out if you need to renew your ITIN through the following points:
1. Check the expiry date on your ITIN card; if it’s expiring in 2019 then, it needs renewal in case you are expecting to file a tax return in the year 2020.
2. ITINs with middle digits 83, 84, 85, 86 or 87 (example: 9NN-87-NNNN) need renewal, in either case, if they have been used in the last three consecutive years or not.
3. Individuals receiving CP48 Notice from the IRS need to renew their ITINs. The Notice will mention steps for renewal of ITINs if they will be used to file a U.S. tax return in 2020.
4. ITINs with middle digits 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81 or 82 have already expired. If your ITIN carries any of these digits, then you can apply for its renewal anytime before 31st December to avoid problems in filing 2020 tax returns.
Note: Taxpayers who have already renewed their ITINs need not take any action on receiving the CP48 Notice unless anyone of their other family members is affected and needs an ITIN renewal.
Options for family ITIN renewal in one go
Taxpayers with expired ITINs with center digits 83, 84, 85, 86 or 87 can now renew their individual and family’s ITIN at the same time even if the family member’s ITINs are not set for expiration in December 2019. In this case, family members include tax filers, spouse and any dependent claimed on an individual’s tax return.
Ways to renew your ITIN
You can now renew your ITIN through the following steps: –
1. Fill the Form W-7 and submit it with all required documentation to the IRS.
2. Write the reason for needing an ITIN on the Form W-7.
1. Taxpayers submitting an ITIN renewal application through Form W-7 need not attach their federal tax return with the form.
2. Spouses and dependents need a renewal on their ITINs only in case they are filing their tax returns individually or in case they are qualifying for an allowable tax benefit. In both these instances, they need to attach the Form W-7 renewal application with their federal tax returns.
Ways to submit the Form W-7 to the IRS
You can now submit your ITIN renewal application Form W-7 through the following ways: –
1. You can mail the Form W-7 either with the original identification documents or with the issuing agency’s certified copies on the address mentioned on the Form W-7. The IRS will review the original identification documents and return them within 60 days of receiving them.
2. You can approach the Certified Acceptance Agents (CAAs) who are authorized to authenticate all identification documents, passports and birth certificates of the primary and secondary taxpayers, and ITIN applications before the submission to the IRS. This way, you would not be required to mail your original documents to the IRS.
3. You can call and make an appointment with the IRS Taxpayer Assistance Center for your ITIN renewal. This way, you would not be required to mail your original documents to the IRS because the authorized persons available at these centres can authenticate each applicant’s identity in person along with their Form W-7.
All individuals who are applying for an ITIN or its renewal shall be present during the appointment along with the Form W-7 and all identification documents.
What happens if you don’t renew your expired ITIN?
If you file your 2020 Federal Tax Returns with an expired ITIN, it will be processed, but then any exemptions or tax credit eligible on your returns will be disallowed. In this case, you would receive a mail from the IRS advising you to change your tax returns and renew your ITIN. On submission of the updated ITIN with the revised tax returns, all your tax credits and exemptions will be restored, and refunds will be issued.
Common errors to avoid
1. Taxpayers often forget to attach the Form W-7 with the identification documents. So, be conscious to send all the required documents together.
2. Ensure to fill the Form W-7 entirely and don’t forget to mention the reason for renewing your ITIN.
3. Ensure to send all the required supporting documents like U.S. residency documents or official documents to support services like change in name etc.
Facts you need to know about Using Passport as an identification document
1. Passport without a date of entry into the U.S. cannot be used as a stand-alone identification document for dependents.
2. This norm applies to dependents from a country other than Canada and Mexico or dependents of the U.S. Military Personnel overseas.
3. If the passport does not have a date of entry into the U.S., then the following supporting documents can be used along with it to prove U.S. residency: –
- U.S. medical records for dependents under the age of 6.
- U.S. school records for dependents under the age of 18.
- U.S. school records (if a student at the time of filing), rental statement, bank statement, utility bills mentioning the dependent’s name and U.S. address in case of dependents above the age of 18.
In conclusion, we would suggest that you renew your ITIN well within the last, i.e., 31st December 2019 to avoid any tax mishap later in 2020. Renewing your ITIN can save you from increased tax liabilities because filing tax returns with an expired ITIN can disallow tax exemptions and credits. So, take timely measures to avoid any such issues in the upcoming year and feel free to contact us for any related advice.
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