Tax Identification Number: Definition & Overview
Do you file your own federal income tax return? Or do you get tax preparers to complete your federal tax returns? What about your employment tax return?Ā
The point is that there can be a lot to consider when it comes to the government’s tax return filing requirements. There are different rules for annual tax returns, marketable securities, and other types of income for taxation purposes. But, within all of this are a few key identifiers.
These can include a tax identification number and an employer identification number. These numbers are needed for income tax purposes. Keep reading to learn all about tax identification numbers.
Table of Contents
KEY TAKEAWAYS
- A tax identification number is a nine-digit number issued by the IRS.
- Individual taxpayers must include their tax identification number on any tax-related documents.
- In many cases, individuals need to have a tax identification number if they want to apply for employment or for credit.
- There can be various types of tax identification numbers, such as an adoption tax identification number and an individual tax identification number.
- All tax ID numbers issued in the U.S. are issued by the IRS, except for the social security numbers. These get issued directly by the Social Security Administration.
What Is a Tax Identification Number?
A Tax Identification Number (TIN) is a tracking number thatās specific to each individual or business.Itās a nine-digit number and itās used by the Internal Revenue Service (IRS) for tax tracking purposes. You will need the number when you apply for a job or a loan. It is also required information to be included on your tax returns.
What Are the Types of Tax Identification Numbers?
The most common tax identification number is the social security number. These numbers get issued to individuals directly by the Social Security Administration. A social security number is usually obtained by your parents shortly after your birth, however, if you were a non-resident person and became a resident by getting a green card or becoming a U.S. Citizen, you would have applied for the SSN then.
A social security number is mandatory if you want to receive various social security benefits or other government services.
The next most common tax identification number is the individual taxpayer identification number (ITIN). This number gets issued by the IRS to nonresident aliens, their dependents, and their spouses if they canāt get their own social security number. It was created, so foreign nationals and other individuals can comply with the tax laws.
To receive an individual taxpayer identification number, you need to complete and submit Form W-7 and any relevant documents.
An Employer Identification Number (EIN) is usually issued to business entities, especially when they have employees. An EIN is required to file business tax returns, open bank accounts as well as to file employment taxes.Ā Ā
Two other common tax identification numbers are the AdoptionTax Identification Number (ATIN) and the Preparer Tax Identification Number (PTIN). The ATIN is a temporary number and is obtained for a child without a SSN to be used during the pending adoption. The PTIN is required for every preparer, who helps prepare tax returns.
How to Get a Tax Identification Number
To get a tax identification number, all you need to do is apply to the proper agency. For example, if you need to get an Individual Taxpayer Identification Number then you would apply directly with the IRS.
To apply for a Social Security Number, you would apply directly with the Social Security Administration. Most of the time, you will be able to apply for the tax ID number only by supplying the supporting documents, like a birth certificate, your permanent residency card or in case of a business, your articles of incorporation.
How to Find Your Tax Identification Number Online
It depends on which agency issued your number. When you first apply, you will receive an official document that includes your number or unique identifier. Since this is a sensitive number that you want to keep private, you often canāt find the number online.Ā
If you canāt seem to find your tax identification number, the best thing you can do is contact the appropriate agency. For example, if you canāt find your SSN, you should contact the Social Security Administration. They will reissue your new SSN card and mail it to your address.
Summary
A tax identification number is a nine-digit number thatās issued by either the IRS or the Social Security Administration. There are a few different kinds of tax identification numbers depending on you being an individual or a business entity.
For example, a Social Security Number is required if you want to work legally. You can also apply for an Employee Identification Number or an Individual Tax Identification Number. Plus, you must include your tax identification number on any tax-related documents if you claim benefits.
FAQs About Tax Identification Number
A Tax ID is the general description of various identification numbers for tax purposes. The social security number is one form of a tax ID.
Not everyone in the United States has a Tax ID Number. It is, however, required if you want to stay compliant with various U.S. Tax Laws. It is necessary to file tax returns, hire employees or open bank accounts.Ā
The best thing you can do is contact the agency that issued the number. In this case, you can contact the IRS if you have any questions about the validity of your TIN. Accounting firms will not have this information.
It does not cost any money to get a tax identification number.
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