A Tax Identification Number (TIN) is a nine-digit number used by the Internal Revenue Service (IRS) to identify taxpayers. Also known as a taxpayer identification number, one type of TIN includes Social Security numbers (SSNs) issued by the Social Security Administration (SSA).
Key Points to Remember
- TINs are nine-digit tracking numbers used by the IRS to identify taxpayers.
- Most U.S. tax I.D. numbers are issued by the IRS, except for SSNs which are issued by the SSA.
- Tax filers must include their TIN on tax-related documents and when claiming benefits.
Different Types of Tax Identification Numbers
Social Security Number (SSN)
The most common tax identification number, issued to U.S. citizens, permanent residents, and certain temporary residents by the Social Security Administration. These numbers are formatted as XXX-XX-XXXX. The SSN is required to secure legal employment in the U.S. and to receive Social Security benefits and other government services.
Individual Taxpayer Identification Number (ITIN)
Issued by the IRS to certain nonresident and resident aliens, their spouses, and their dependents when they’re ineligible for SSNs. They’re arranged in the same format as an SSN (XXX-XX-XXXX) but always begin with a 9. The applicant must complete Form W-7 and submit documents supporting their resident status to get an individual tax ID number.
Employer Identification Number (EIN)
Used by the IRS to identify corporations, trusts, and estates that must pay taxes. These numbers are read as XX-XXXXXXX and those who qualify must apply for and use it to report their capital gains and income.
Adoption Tax Identification Number (ATIN)
This number is used for domestic adoptions when the adoptive parents cannot obtain the child’s SSN to complete their tax returns. The child must be a U.S. citizen or permanent resident to qualify and the adoption must be pending.
Preparer Tax Identification Number (PTIN)
The IRS requires tax preparers who charge for completing or assisting with tax returns for others to have and use a PTIN.
Parents must apply for an SSN for their child before claiming them as a dependent for tax purposes.
When Is a TIN Required?
A TIN identifies individuals, corporations, and entities such as nonprofit organizations. The TIN is mandatory for anyone filing annual tax returns with the IRS, and the agency uses it to track taxpayers. Here are scenarios where a TIN is required:
- For credit: Banks and other lenders require SSNs on credit applications, which are then relayed to credit bureaus.
- For employment: Employers require an SSN from job applicants to verify work authorization in the United States.
- For state agencies: Businesses require state identification numbers for tax purposes to file with their state tax agencies. State taxing authorities issue the I.D. number directly to the filer.
Global TINs
Almost every country uses TINs for various reasons. Canada, for example, uses Social Insurance Numbers (SINs) for employment, tax, benefits, and credit purposes. European Union countries also use TINs to help government agencies identify taxpayers and allow entities to invest money across the Union.
Who Needs a Tax Identification Number?
To work in the United States or file taxes with the IRS, individuals need a TIN. It allows individuals to take advantage of benefits or services offered by the government, run their day-to-day business operations, and report their taxes.
Are TINs Available Online?
The agency that issues a TIN provides individuals with an official document containing their unique identifier. TINs are not available online due to their sensitive nature.
Is a Taxpayer Identification Number the Same as a Social Security Number?
A Social Security number is a type of TIN. It permits individuals to seek employment in the U.S., obtain credit, and file income tax returns.
Conclusion
A taxpayer identification number, or TIN, is essential for working in the United States and filing tax returns. Individuals can obtain a Social Security number through the Social Security Administration or other types of TINs from the IRS.
References
- Social Security Administration. “Social Security Number & Card”.
- IRS. “Individual Taxpayer Identification Number”.
- IRS. “Employer ID Numbers”.
- IRS. “Adoption Taxpayer Identification Number”.
- IRS. “PTIN Requirements for Tax Return Preparers”.
- IRS. “Qualifying Child Rules”.
- IRS. “U.S. Taxpayer Identification Number Requirement”.
- Government of Canada. “Social Insurance Number Overview”.
- European Commission. “TIN-Taxpayer Identification Number”.
