Tax Identification Number (TIN) Definition, Types, and How To Get One

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Tax Identification Number (TIN) Definition, Types, and How To Get One

What Is a Tax Identification Number (TIN)?

A Tax Identification Number (TIN) is a nine-digit number used by the Internal Revenue Service as a tracking number (IRS).It is mandatory information on all tax returns submitted to the IRS. Except for Social Security numbers (SSNs), which are provided by the Social Security Administration, all U.S. tax identification numbers (TINs) or tax I.D. numbers are issued directly by the IRS (SSA).Foreign tax identification numbers (foreign TINs) are likewise not issued by the IRS, but rather by the nation in which the non-US taxpayer pays taxes.

Tax Identification Number (TIN)

Key Takeaways

  • Tax identification numbers are nine-digit tracking identifiers used by the IRS to ensure that tax regulations are followed.
  • Except for social security numbers, which are provided by the Social Security Administration, the IRS issues all U.S. tax identification numbers.
  • On tax-related paperwork and when claiming benefits, taxpayers must mention their tax identification number.
  • When seeking for loans or employment, TINs are also necessary.
  • Tax identification numbers are classified into three types: employer identification numbers, individual tax identification numbers, and adoption tax identity numbers.

Understanding the Tax Identification Number (TIN)

A tax identification number is a one-of-a-kind collection of numbers that identifies persons, businesses, and other legal entities such as nonprofit organizations (NPOs).Each individual or organization must apply for a TIN. Once authorized, the assigning agency issues a unique number to the applicant.

The TIN, commonly known as a taxpayer identification number, is required for anybody submitting yearly tax returns with the IRS and is used to trace taxpayers. Filers must mention the number on tax-related papers and when receiving government benefits or services.

TINs are also required for other purposes:

  • Banks and other lenders demand Social Security numbers for loan applications. This information is subsequently communicated to credit bureaus to check that the application is being filled out by the correct individual. Credit reporting organizations utilize TINs, specifically SSNs, to record and monitor an individual’s credit history.
  • Employers demand a Social Security number from anybody looking for a job. This is done to guarantee that the person is legally permitted to work in the United States. Employers confirm the figures with the issuing agency.
  • State agencies need state identification numbers for tax reasons in order to file with their respective state tax agency. The I.D. number is issued immediately to the filer by the state taxation authority.
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There are numerous types of tax identification numbers or taxpayer identification numbers. Individuals are given Social Security numbers (SSNs), while companies (such as corporations and partnerships) are given employment identification numbers (EINs).Individual Taxpayer Identification Number (ITIN), Adoption Taxpayer Identification Number (ATIN), and Preparer Tax Identification Number (PTIN) are examples of TINs (PTIN).More information about these sorts may be found further down.

Special Considerations

TINs are used for a variety of purposes in almost every nation. For example, in Canada, Social Insurance Numbers (SINs) are used for employment, taxation, benefits, and credit reasons. The SIN, like the SSN in the United States, is a nine-digit unique identification formatted as XXX-XXX-XXX.

TINs are also used in the European Union. They assist government authorities in identifying taxpayers and allowing companies to invest their funds within the Union.

Types of Tax Identification Numbers (TIN)

Social Security Number (SSN)

The most prevalent tax identification number is the social security number (SSN). The Social Security Administration issues SSNs to persons who are US citizens, permanent residents, or certain temporary residents. These numerals are written in the pattern XXX-XX-XXXX.

The SSN is necessary in order to get legal work in the United States, as well as to receive social security payments and other government services. A kid must have an SSN before a parent may claim them as a dependant for income tax reasons, which implies parents apply for the number on their children’s behalf freely. A dependency may be claimed for a kid who has an ITIN. The Social Security Administration processes applications for free, however there are fee-based firms that offer to finish applications for new parents.

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Your Social Security number is a unique identification that scammers may exploit, so only provide it to individuals who need it, such as the IRS, employers, and lenders.

Individual Taxpayer Identification Number (ITIN)

When some nonresident and resident aliens, their spouses, and their dependents are ineligible for SSNs, the IRS provides an Individual Taxpayer Identification Number (ITIN). The ITIN starts with a 9 and is formatted similarly to an SSN (XXX-XX-XXXX). To get an individual tax identification number, the applicant must fill out Form W-7 and provide documentation proving his or her residency status. Certain organizations, such as universities, banks, and accounting companies, often assist candidates in obtaining their ITIN.

EmployerIdentification Number (EIN)

The Employee Identification Number (EIN) is used by the IRS to identify companies, trusts, and estates that must pay taxes. Employer tax ID numbers, like SSNs, are nine digits long, but they are read as XX-XXXXXXXXX. Those who are eligible for an EIN must apply for one and utilize it to declare their income for tax reasons. It is free to apply for an EIN, and companies may get one right away.

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. To qualify, the child must be a U.S. citizen or permanent resident and the adoption must be pending.

Preparer Tax Identification Number (PTIN)

As of Jan. 1, 2011, the IRS required the listing of a PTIN on each return filed. Before this date, the use of the PTIN was optional. Any preparer that charges to complete all or part of the tax return for another individual must have and use the PTIN.

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How Can I Get a TIN?

You can get a tax identification number by applying directly to the correct agency. For instance, you can get a Social Security number through the Social Security Administration. If you need an Individual Taxpayer Identification number or one for a business, you may be able to obtain one directly from the Internal Revenue Service.

How Do I Know If I Need a TIN?

If you want to work in the United States or pay taxes with the IRS, you’ll need a TIN. You’ll also need a TIN if you wish to take advantage of government perks or services. If you own a company or other organization, you’ll need a TIN to conduct day-to-day activities and file taxes.

How Can I Find My TIN Online?

The agency that issues your TIN issues you an official document including your unique identification. You cannot obtain it online since it is classified material. If you can’t recall or have misplaced your paperwork, you should contact the issuing agency, such as the Social Security Administration, to get your TIN again.

Is a TIN the Same as a Tax I.D.?

A TIN, which stands for tax identification number or taxpayer-identification number, is the same as a tax I.D.

Is a TIN the Same as a Social Security Number?

A TIN is an example of a personal identification number. It enables you to apply for jobs in the United States, acquire credit from banks and other lenders, and submit your yearly tax returns with the IRS using your SSN.

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