Tax Advisory

Tax Identification Number (ITIN) Renewal Program

If you are an individual that is not a U.S. citizen or U.S. green card holder (permanent resident) and are not an employee of a United States employer but have the need to file a tax return with the United States, you likely have an Individual Tax Identification Number (ITIN).

Starting October 1, 2016, the IRS is implementing a program where every ITIN issued will expire at a specified date unless the holder of the ITIN undergoes a renewal process.

The following groups of ITIN holders have been identified by the IRS:

  1. ITINs for individuals that was not used on a US tax return in 2013, 2014 or 2015 [Unused ITINs]
  2. ITINs issued before 2013 for individuals that were used on a US tax return in 2013, 2014 or 2015 [Expiring ITINs]

Note that it is only those individuals that need to file a US tax return or be claimed as a dependant on a US tax return that need to have the ITIN renewed. 

ITINs used solely on information returns (form 1042-S) filed by third parties will not need to be renewed.  Typically, a non-resident non-citizen can provide a W-8 form to a US payer without having an ITIN, once every 3 years and thereafter, you will no longer need to have an ITIN.

The following individuals should receive letters from the IRS outlining the renewal process:

  1. All individuals in group 1
  2. Individuals in group 2 whose ITIN contains either 9xx-78-xxxx or 9xx-79-xxxx

All other group 2 ITIN holders will start receiving renewal letters on a rolling basis.  The schedule for when you will receive these letters has yet to have been announced.

To renew an ITIN, the individual will need to complete a new W-7 application form [new version to be released this September] and obtain a certified copy of their passport [or present the actual document to specific agents]. 

In addition, the IRS has noted that at the time one person that is reported on a tax return is required to renew their ITIN, the IRS will allow all family members to renew their ITINs at the same time rather than individually over many years.  Family members in this case are those reported on the same tax return: the taxpayer, spouse and any dependants.  For example, if the ITIN for a dependant child is required to be renewed during 2017 but the ITIN for another child does not need to be renewed in 2017, you may renew all of your children’s ITINs at the same time during 2017.  You do not need to wait until each person receives a notice from the IRS.

It is our understanding that renewals will be required every few years where U.S. personal income tax returns are required to be filed.

Barry Doerbecker, CPA, CA, LPA, EA (USA0

Principal – Cross Border Tax Services – Bateman MacKay LLP

Email:       bdoerbecker@batemanmackay.com

Toll Free:  1 (866) 236 – 9585