The IRS has made changes to the Individual Taxpayer Identification Number (ITIN) program as a result of the Protecting Americans from Tax Hikes (PATH) Act.
What’s changing?
All ITINs not used on a federal income tax return at least once for tax years 2017, 2018, or 2019 will expire on December 31, 2020. Additionally, all ITINs with middle digits 88 (For example: 9NN-88-NNNN) will expire at the end of this year. Those with middle digits 90, 91, 92, 94, 95, 96, 97, 98 or 99, that were assigned before 2013 and have not already been renewed, will also expire at the end of this year.
Check ITIN Expiration Frequently Asked Questions for more information.
The IRS will begin sending the CP48 notice, You must renew your Individual Taxpayer Identification Number (ITIN) to file your U.S. tax return, late summer to taxpayers who have filed a tax return in the last three years containing an ITIN with the middle digits referenced above, that have not already been renewed. The notice explains the steps to take to renew the ITIN if it will be included on a U.S. tax return filed in 2021.
The IRS encourages taxpayers to begin the renewal process as soon as possible to avoid the rush. There is no need to wait until you receive notice of expiration. If you or someone in your family has an ITIN with the affected middle digits and you expect to have a filing requirement in 2021, you can go ahead and submit your renewal application now.
If you receive your CP48 notice after you begin the renewal process, you can ignore it. No additional action will be required on your part.
As a reminder, ITINs with middle digits 83 through 87 expired last year. Middle digits 73 through 77, 81 and 82 expired in 2018. Middle digits 70, 71, 72, and 80 expired in 2017, and 78 and 79 expired in 2016. Taxpayers with these ITIN numbers who expect to have a filing requirement in 2021 can renew at any time.
What do you need to do to renew your ITIN?
To renew an expired ITIN, you must submit a completed Form W-7, Application for IRS Individual Taxpayer Identification Number, and all required identification documents to the IRS. Use the most current revision of the Form W-7 available on irs.gov and refer to the Form W-7 instructions for guidance.
To make this renewal effort easier and reduce paperwork, all family members (including the tax filer, spouse and any dependents listed on a tax return) may renew their ITINs at the same time.
What important things do you need to know about renewing your ITIN?
There are three ways taxpayers can submit their Form W-7 application package. They can:
• Mail their Form W-7 and original identification documents or copies certified by the agency that issued them to the IRS address listed on the form instructions. The IRS will review the identification documents and return them within 60 days.
• Use one of the many Certified Acceptance Agents (CAAs) authorized by the IRS to help them apply for an ITIN. CAAs can certify all identification documents for primary and secondary taxpayers as well as passports and birth certificates for dependents. This saves taxpayers from mailing original documents to the IRS, or
• Call and make an appointment at a designated IRS Taxpayer Assistance Center.
If you file a U.S. tax return with an expired ITIN, there may be a delay in processing your tax return. Acting now to renew will help avoid delays. No action is necessary if you do not need to file a tax return. ITINs that are only used on information returns filed with the IRS by third parties do not need to be renewed.
However, if you use the ITIN to file a U.S. tax return in the future (including for a dependent), the ITIN will need to be renewed with your tax return or before you file. Spouses and dependents residing outside of the U.S. cannot renew in advance. They may renew their ITIN only when filing an individual tax return, or someone else files an individual income tax return claiming them for an allowable tax benefit (such as a dependent parent who qualifies the primary taxpayer to claim head of household filing status). In these instances, they must attach a federal income tax return to their W-7 renewal application.
As a reminder, the IRS no longer accepts passports that do not have a date of entry into the U.S. as a stand-alone identification document for dependents from a country other than Canada or Mexico or dependents of military members overseas. The dependent’s passport must have a date of entry stamp–otherwise the following additional documents to prove U.S.
residency are required:
• U.S. medical records for dependents under 6
• U.S. school records for dependents under 18 and
• U.S. school records, rental statements, bank statements or utility bills listing the applicant’s name and U.S. address, if 18 years of age or older.
For more information, visit the ITIN information page on IRS.gov
As always, should you have any questions or concerns regarding your tax situation please feel free to contact us.
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