If you are a non-resident alien in the US, you may have heard of ITIN, or Individual Taxpayer Identification Number – but what is it exactly and why do you need it?
Simply put, an ITIN is a nine-digit tax identification number issued by the IRS to individuals allowing them to comply with the US tax system and file taxes, even if they don’t have a social security number.
The main reason why you need an ITIN is to file taxes. It’s a requirement if you want to report US income, claim tax credits, or pay taxes on foreign investments. However, an ITIN can also be used to open bank accounts or apply for mortgages or business loans, as well as to obtain driver’s licenses in some states. Ultimately, it can provide non-resident aliens with access to the US financial system.
Applying for an ITIN is a relatively simple process. You have to fill out the IRS Form W-7, along with the necessary supporting documents. Once you have submitted the form, you should receive your ITIN in the mail within 7 weeks depending on how fast IRS process your application. Luckily, Afterglow is here to help you with the paperwork and filings. We offer quick and easy ITIN application service for you to obtain your ITIN number.
But your responsibilities do not end after you get your ITIN. Once you have obtained your ITIN, it’s important to make sure that you keep it up to date. ITINs expire after five years, so you will need to renew your ITIN every five years by submitting a new Form W-7. It’s also important to make sure that your address is up to date, since the IRS will send any correspondence to the address associated with your ITIN.
It’s also wise to make sure you are aware of the tax regulations that apply to non-residents in the US. Understanding the US tax system can be complex, and non-resident aliens are subject to different rules than US citizens. Therefore, you should consult with a qualified tax professional to make sure that you are compliant with all applicable tax laws. Please feel free to reach out to Afterglow to book an appointment with a CPA!
In conclusion, having an ITIN is an important step for non-residents in the US who want to comply with the US tax system and access the US financial system. Knowing how to maintain and use your ITIN will help you stay on top of your taxes and make sure you are in compliance.