Matter & Substance
  August 24, 2023

Navigating Tax and Social Security Identification Numbers as a U.S. Immigrant

Content provided by Derek Morgan, Senior International Tax Services Manager

For immigrants coming to the U.S.—whether they are here for temporary employment, permanent residency, or other similar situations—understanding the intricacies of the U.S. tax and social security systems is crucial. Two essential U.S. identification numbers immigrants often need are (i) the Social Security Number (SSN) and (ii) the International Tax Identification Number (ITIN).

Understanding the Differences between ITINs and SSNs

An SSN is a nine-digit identification number issued to U.S. citizens and authorized non-citizens by the U.S. Social Security Administration (SSA). It serves as a personal ID primarily for employment, government programs and many other purposes.

An ITIN is also a nine-digit number issued by the IRS for nonresident and undocumented individuals who need to pay taxes but are ineligible for an SSN. The ITIN is needed primarily for tax filing, but it does not provide government authorization to work or reside in the U.S. An ITIN can be used as a replacement for SSN in some cases, such as applying for personal loans.

Benefits of ITINs and SSNs

Obtaining a SSN or ITIN is essential for immigrants to the U.S. as they enable individuals to navigate legal, financial, and social aspects of life in the country. These identification numbers serve as crucial tools that facilitate integration and participation in various aspects of American everyday life, including (but not limited to):

  • Tax Compliance: Immigrants who earn income in the US are required to file tax returns, and having these identification numbers is essential for accurately reporting income, claiming deductions, and ensuring compliance with tax laws.
  • Employment: An SSN is often a prerequisite for employment in the US. Employers use SSNs to verify an individual's eligibility to work and to report wages and taxes to the government. Without an SSN, immigrants may face challenges in securing lawful employment opportunities. An ITIN is not a valid ID for employment purposes.
  • Banking and Financial Transactions: Many financial institutions require an SSN or ITIN to open bank accounts, apply for credit, and engage in other financial transactions. Having these identification numbers enables immigrants to establish a stable financial foundation and build credit history.
  • Housing and Rental Agreements: Landlords and property management companies often request an SSN or ITIN as part of the rental application process. These identification numbers help establish an individual's identity and background, making it easier to secure housing.
  • Legal and Immigration Processes: Both identification numbers can be crucial during legal and immigration proceedings, helping establish an individual's identity and legal status.

Applying for a Social Security Number as an Immigrant

U.S. citizens, Green Card holders, permanent residents, and eligible workers who have permission to work from the Department of Homeland Security (DHS) are eligible to receive a U.S. Social Security Number (SSN).  If an immigrant is a member of one of the groups eligible to apply for a SSN, they are not eligible to receive an ITIN. Many applicants in these groups that are eligible for a SSN get rejection letters from the ITIN processing department with little additional information, resulting on confusion over eligibility.

For those persons eligible and needing to acquire a SSN, the process is straightforward. The SSN application is typically submitted in person at a local Social Security office or the closest U.S. Embassy, if the applicant has not yet traveled to the U.S. Immigrating applicants need to provide proof of identity, U.S. work authorization, and other relevant documentation.

Prior to making an in-person application for a SSN, individuals will need to bring a few pieces of information, including:

  • Form I-94 (Record of Arrival to/Departure from the U.S.)
  • Bill, lease, or other verification of U.S. Address

Immigrating applicants will also need one of the following:

  • Form I-551 Permanent Resident Card
  • Form I-766 Employment Authorization Form
  • Valid (not expired) Passport with an Admission stamp permitting work in the U.S.

For minor children under the age of eighteen, the process is slightly more complicated. Children over twelve must appear in person with their parent to apply for the SSN. (If the child is under 12, they do not have to appear, and the parent can provide the details.) Both parent and child should have the following information:

  • Passport
  • Form I-94 AND one of the following:
    • Health Insurance Card (with the child’s name on it)
    • School Identification Card (most U.S. schools can issue upon request)
    • Any other documentation that provides direct identification data. Documents for direct identification must not be expired and must show name, date of birth, and a current photograph.

Typically, SSNs are issued within two weeks of application if the Social Security Administration can verify immigration data with the department of U.S. Citizenship and Immigration Services. For best results, immigrating persons should wait at least 10 days from entering the country for these records to be available.

Applying for an International Tax Identification Number

As previously noted,  the ITIN is a unique nine-digit number issued by the Internal Revenue Service (IRS) to individuals who are not eligible for a Social Security Number but are required to file taxes in the U.S. For example, immigrating persons who do not have work authorization or are not eligible for an SSN, such as dependents of certain visa holders, can apply for an ITIN.

  • Completing Form W-7: Immigrants seeking an ITIN must fill out Form W-7 (Application for IRS Individual Taxpayer Identification Number). This form requires immigrating persons to provide personal information, including the reasons for needing an ITIN.
  • Documentation: ITIN applicants must attach original or certified copies of required documents, including proof of identity and foreign status. Acceptable documents include passports, visas, birth certificates, and other identification issued by their home country. The form also requires supporting documents, such as a valid federal tax return or a certified copy of their passport.
  • Submission: The completed Form W-7 and the necessary documents can be submitted to the IRS either by mail or in person at certain IRS Taxpayer Assistance Centers. Many Certified Acceptance Agents (CAAs) can also assist with this process.
  • Processing: After submitting the application, the IRS will review the information and, upon approval, issue an ITIN. Processing times can vary, but applicants can track their application's status online.

We’re Here to Help

Navigating the US tax and social security systems as an immigrant can be complex but obtaining an International Tax Identification Number (ITIN) or a Social Security Number (SSN) is a significant step toward financial stability and legal compliance. Immigrants should carefully follow the application processes outlined by the IRS and the Social Security Administration to ensure smooth acquisition of these essential identification numbers.

If you have any questions or would like more information about this process, please contact your tax advisor.