This report covers U.S. taxpayers whose Individual Taxpayer Identification Numbers (ITINs) have expired and need to renew their ITINs if they are filing tax returns in 2018.
The U.S. Internal Revenue Service (IRS) is urging taxpayers to complete and submit renewal applications if their Individual Taxpayer Identification Numbers (ITINs) are expiring or have expired.1
Any ITIN not used on a U.S. federal income tax return at least once in the last three consecutive years was due to expire. For instance, those with middle digits of 70, 71, 72, or 80 (xxx-70-xxxx; xxx-71-xxxx; etc.) expired on December 31, 2017. Such expired ITINs would need to be renewed if the taxpayer has a filing obligation in 2018. ITINs that have middle digits 78 or 79 expired on December 31, 2016; however, they can still be renewed.
The renewal process is significant given that tax filing season has just begun; tax returns with expired ITINs could experience processing delays. In addition, taxpayers with expired ITINs may lose eligibility for certain tax benefits until their ITIN is renewed.
Federal income tax returns that are submitted in 2018 with expired ITINs will be processed, but taxpayers will not be eligible to claim exemptions and/or certain tax credits until their ITINs are renewed.
Affected taxpayers are encouraged to renew their ITINs as soon as possible.
The ITIN is a tax identification number used, generally, by individuals who have U.S. income tax filing or payment obligations, but who are not eligible for a Social Security number.
In 2015, Congress passed the Protecting Americans from Tax Hikes (PATH) Act which created an expiration schedule for ITINs.2
The IRS release provides guidance for renewing ITINs that have expired, or are set to expire, based on the expiration schedule included in the PATH Act. Affected taxpayers who need to file a tax return in 2018 are encouraged to renew their ITINs without delay. The release notes: ”An ITIN renewal can take up to 11 weeks for the IRS to complete during the tax season.”
Taxation of International Executives covers relevant income tax and social security rates, together with the key aspects of the tax legislation relating to expatriate employees working in various countries. In addition, planning opportunities, capital taxes, and local taxes are also covered. Taxation of International Executives: United States, the annual publication from KPMG International, has been updated to account for U.S. tax law in effect as of December 31, 2017. This edition also includes provisions affecting individuals introduced by the Tax Cuts and Jobs Act (now Public Law No. 115-97). To access the publication – in a convenient and easy-to-use .html format – click here.
For other countries’ Taxation of International Executives, click here.
The above information is not intended to be "written advice concerning one or more Federal tax matters" subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230 as the content of this document is issued for general informational purposes only.
The information contained in this newsletter was submitted by the KPMG International member firm in the United States.
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