Contrary to popular belief, many undocumented immigrants in the United States can pay taxes and they do. If you want to learn the benefits of doing this and how it is done, watch the video below and read on.
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Taxpayer Personal Identification Number (ITIN): What is it?
An ITIN is a nine-digit number issued by the IRS to people who must have an identification number but are not eligible for a Social Security number or an Employer Identification number. It is for tax purposes only and cannot be used for identification purposes. The Internal Revenue Service (IRS) does not share ITIN information with immigration authorities.
The following are examples of people who may need an ITIN:
- An undocumented immigrant who files taxes in the United States but is not eligible for a Social Security number
- An immigrant resident in the United States (based on days present in the United States) that files taxes and is not eligible for a Social Security number.
- A dependent or spouse of an American citizen / Resident.
- A dependent or spouse of a person with a non-resident immigrant visa.
ITIN: The benefits
Having an ITIN and paying taxes can help undocumented immigrants to show good moral character when they apply to the residence. It is also useful for establishing your marital status, which is important for immigration petitions.
Other benefits include having the ability to open a bank account that earns interest, provides proof of residence and in some States (including Connecticut that if you can prove that you live in the state), you can obtain a driver’s license.
ITIN holders are eligible for the Child Tax Credit (CTC) if their child is a US citizen and has a Social Security number. As of December 2017, the CTC tax credit can be up to $ 2,000 per qualifying child.
ITIN: What you don’t grant
An ITIN holder is not eligible for Social Security benefits or the Earned Income Tax Credit. However, if that person later legalizes their status and becomes a permanent citizen they will be eligible for Social Security, earnings reported with an ITIN will be counted for the amount he / she is eligible to receive.
ITIN: How to get it
It’s easy to apply for an ITIN and you don’t have to do it in person or go through your employer. Applicants must complete Form W-7 and submit it to the IRS along with a complete tax return and original documents verifying the identity and “alien status”; A passport is the document most commonly used to do this.
When the application is approved, the ITIN is sent to the applicant by mail. Any verification document sent by the applicant will be returned within 60 days after receipt and processing of the W-7 form.
All ITINs issued after December 31, 2012 must be revalidated every five years. If you have an ITIN but have not used it for more than three years, it is considered expired and must be revalidated.
If you have any questions, schedule your free consultation with us at 704-886-6665