What Is a Tax Identification Number (TIN)?
A Tax Identification Number (TIN) is a nine-digit number used as a tracking number by the Internal Revenue Service (IRS). It's required information on all tax returns filed with the IRS.
All U.S. tax identification numbers (TINs) or tax I.D. numbers are issued directly by the IRS except Social Security numbers (SSNs), which are issued by the Social Security Administration (SSA). Foreign tax identifying numbers (foreign TINs) aren't issued by the IRS, either. They're issued by the country in which the non-U.S. taxpayer pays taxes.
Key Takeaways
- Tax identification numbers are nine-digit tracking numbers used by the IRS.
- The IRS issues all U.S. tax I.D. numbers except for Social Security numbers, which are issued by the Social Security Administration.
- Tax filers must include their tax identification number on tax-related documents and when they're claiming benefits.
- TINs are also required when applying for credit and employment.
- There are a few types of tax identification numbers, including the employer identification number, the individual tax identification number, and the adoption tax identification number.
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Understanding the Tax Identification Number (TIN)
A tax identification number is a unique set of numbers that identifies individuals, corporations, and other entities such as nonprofit organizations (NPOs). Each person or entity must apply for a TIN. The agency assigns the applicant a special number when they're approved.
The TIN, which is also called a taxpayer identification number, is mandatory for anyone filing annual tax returns with the IRS. The agency uses it to track taxpayers. Filers must include the number on tax-related documents and when claiming benefits or services from the government.
TINs are also required for other purposes:
- For credit: Banks and other lenders require Social Security numbers on applications for credit. This information is then relayed to the credit bureaus to ensure that the right person is filling out the application. The credit reporting agencies also use TINs, notably SSNs, to report and track an individual's credit history.
- For employment: Employers require an SSN from anyone applying for employment. This ensures that the individual is authorized to work in the United States. Employers verify the numbers with the issuing agency.
- For state agencies: Businesses also require state identification numbers for tax purposes in order to file with their state tax agencies. State taxing authorities issue the I.D. number directly to the filer.
Tax identification numbers or taxpayer identification numbers come in several forms. Individuals are assigned TINs in the form of Social Security numbers (SSNs), whereas businesses such as corporations and partnerships are assigned employer identification numbers (EINs).
Other types of TINs include the Individual Taxpayer Identification Number (ITIN), the Adoption Taxpayer Identification Number (ATIN), and the Preparer Tax Identification Number (PTIN).
TINs in Different Countries
Almost every country uses TINs for various reasons. Canada uses Social Insurance Numbers (SINs) for employment, tax, benefits, and credit purposes. The SIN is a nine-digit unique identifier that's formatted as XXX-XXX-XXX.
Countries in the European Union also use TINs. They help government agencies identify taxpayers and allow entities to invest their money across the Union.
Types of Tax Identification Numbers (TIN)
Social Security Number (SSN)
The Social Security number (SSN) is the most common tax identification number. SSNs are 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.
A child must have an SSN before a parent can claim them as a dependent for income tax purposes so parents voluntarily apply for the number on behalf of their children. A child with an ITIN can also be claimed as a dependent. The SSA processes applications for free but there are also fee-based services that offer to complete applications for new parents.
Your Social Security number is a unique identifier that can be misused by fraudsters so make sure you only release it to those who are required to access it, such as the IRS, employers, and lenders.
Individual Taxpayer Identification Number (ITIN)
The IRS issues the Individual Taxpayer Identification Number (ITIN) 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). The ITIN always begins with a 9.
The applicant must complete Form W-7 and submit documents supporting their resident status to get an individual tax ID number. Certain agencies including colleges, banks, and accounting firms often help applicants obtain their ITIN.
EmployerIdentification Number (EIN)
The IRS uses the Employer Identification Number (EIN) to identify corporations, trusts, and estates that must pay taxes. Just like SSNs, employer tax ID numbers are nine digits but they're read as XX-XXXXXXX. Those who qualify for EINs must apply for the number and use it to report their capital gains and income for taxation purposes. Applying for an EIN is free and businesses can obtain one immediately.
Adoption Tax Identification Number (ATIN)
The ATIN only applies to domestic adoptions when the adoptive parents cannot obtain the child's SSN to complete their tax returns promptly. 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 has required the listing of a PTIN on each tax return filed since Jan. 1, 2011. The use of the PTIN was optional before this time. Any preparer that charges to complete all or part of a tax return for another individual must have and use a PTIN.
How Do I Know If I Need a TIN?
You'll need a TIN if you're authorized to work in the United States or if you plan to file taxes with the IRS. You'll also need a TIN if you want to take advantage of benefits or services offered by the government or to run your day-to-day operations and to report your taxes if you run a business or other organization.
Can I Find My TIN Online?
The agency that issues your TIN will provide you with an official document with your unique identifier. You can't go online to retrieve it because it's a sensitive piece of information. Contact the issuing agency, such as the SSA, to get your TIN if you can't remember it or lose your documents.
Is a TIN the Same As a Tax I.D.?
A TIN is the same as a tax I.D. The letters stand for "tax identification number" or "taxpayer identification number."
Is a TIN the Same As a Social Security Number?
A Social Security number is an example of a TIN. It allows you to seek employment in the United States and to obtain credit with banks and other lenders. You can file your annual tax returns with the IRS using your SSN.
The Bottom Line
You can get a tax identification number by applying directly to the correct agency if you don't already have one. You can get a Social Security number through the Social Security Administration. You can usually obtain an Individual Taxpayer Identification number or a number for a business directly from the IRS.
Having a TIN is necessary for individuals to work in the United States and you can't file a tax return without one. Reach out to the IRS or United States Citizenship and Immigration Services if you're not a U.S. citizen, don't have a number, and you're unsure how to proceed. Numerous websites can help you as well, but be wary about using this option. Make sure they're not fraudsters before providing them with any of your personal information.
Given your interest in tax identification numbers (TINs), I can dive into the specifics of this topic. A TIN serves as a unique identifier for entities or individuals when dealing with the IRS. I'll break down the concepts used in the article you've provided:
Tax Identification Number (TIN)
- Definition: A nine-digit number used by the IRS to identify taxpayers.
- Issuance: All U.S. TINs are issued by the IRS except for Social Security numbers, which are issued by the Social Security Administration. Foreign TINs are issued by the taxpayer's home country.
- Types: Employer Identification Number (EIN), Individual Taxpayer Identification Number (ITIN), Adoption Tax Identification Number (ATIN), and more.
Uses of TINs
- Tax Filing: Required for all tax returns filed with the IRS.
- Credit & Employment: Needed for credit applications and employment verification.
- Government Benefits: Necessary for claiming benefits or services from the government.
Types of TINs Explained
- Social Security Number (SSN): Issued to U.S. citizens, permanent residents, and certain temporary residents by the SSA. Used for employment, Social Security benefits, and tax purposes.
- Individual Taxpayer Identification Number (ITIN): Provided by the IRS to certain nonresident and resident aliens, their spouses, and dependents when they're ineligible for SSNs.
- Employer Identification Number (EIN): Used by corporations, trusts, and estates for tax purposes. A nine-digit number issued by the IRS.
- Adoption Tax Identification Number (ATIN): Used in domestic adoptions when the child's SSN is not available.
- Preparer Tax Identification Number (PTIN): Required for tax preparers filing returns for others.
TINs in Different Countries
- Canada: Uses Social Insurance Numbers (SINs) for similar purposes.
- European Union: Countries within the EU also utilize TINs for taxpayer identification and financial transactions.
Obtaining a TIN
- Applying: Individuals or entities must apply for a TIN directly from the relevant agency. SSNs come from the SSA, while ITINs and business-related TINs come from the IRS.
- Necessity: Essential for legal employment, filing taxes, accessing government services, and conducting business operations.
Retrieving TIN Information
- Online Access: Official documents containing TINs aren't available online due to sensitivity. Contact the issuing agency (e.g., SSA or IRS) for retrieval.
TIN and Tax I.D. Relationship
- TIN vs. Tax I.D.: TIN is the acronym for "tax identification number" or "taxpayer identification number." They are the same thing.
TIN vs. Social Security Number (SSN)
- Relationship: An SSN is an example of a TIN used specifically in the United States for employment, credit, and tax filing.
Bottom Line
- Necessity: Having a TIN is crucial for various purposes such as working, tax filing, and accessing government services.
- Application: Obtaining a TIN involves direct application to the relevant agency, ensuring authenticity and legal compliance.
This comprehensive understanding of TINs underscores their significance in tax administration, employment authorization, and financial activities. If you have any specific questions or need further clarification, feel free to ask!
