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Fact check: How does the IRS handle tax returns from individuals without a valid Social Security number?
Executive summary
The IRS requires a Taxpayer Identification Number for filing: individuals without a valid Social Security number must obtain an Individual Taxpayer Identification Number (ITIN) by submitting Form W‑7 with supporting identity and foreign-status documentation, usually attached to a federal return, and ITINs are strictly tax processing numbers that do not confer work authorization or Social Security benefits [1] [2]. Recent IRS guidance tightens timing and documentation requirements for credits and renewals, and the agency is pursuing privacy and verification changes—like masking SSNs and piloting electronic passport checks—to reduce identity theft and streamline ITIN processing [3] [4] [5].
1. Why the IRS issues an ITIN and what it actually does — clarifying the core rule
The IRS issues ITINs to people who must file U.S. federal tax returns but are ineligible for Social Security numbers, including certain nonresident and resident aliens, spouses, and dependents; the ITIN exists solely for federal tax administration and cannot be used to obtain Social Security benefits or to authorize legal employment [1] [2]. Applicants demonstrate a federal tax purpose almost always by attaching an original federal income tax return to Form W‑7, although recognized exceptions permit submitting W‑7 without a return when specific conditions are met; Acceptance Agents can help certify identity documentation to avoid mailing originals [2] [6]. This separation of tax identification from immigration or employment status is foundational to IRS practice.
2. Paperwork, timing, and the practical roadblocks taxpayers face when they lack an SSN
To obtain an ITIN taxpayers must complete Form W‑7 and provide documentation substantiating identity and foreign status; passports are the single most common document, and applicants typically mail the W‑7 with their return unless an exception applies or an Acceptance Agent certifies documents [2] [5]. Recent reminders emphasize that certain tax credits for the 2024 tax year require a valid SSN or ITIN by the extended filing deadline, so taxpayers using software that flags missing identifiers are expected to secure an ITIN before that deadline to claim credits [3]. This deadline-driven reality generates pressure and can delay refunds if documentation is incomplete.
3. Electronic filing and mismatch handling — a practical shift in IRS operations
The IRS has relaxed some barriers to e‑filing by allowing returns to be e‑filed despite ITIN/SSN mismatches, reflecting efforts to modernize filing pathways while still requiring appropriate documentation of tax purpose [6]. Allowing e‑filing with mismatches reduces one administrative hurdle, but it does not eliminate the underlying requirement to submit Form W‑7 and supporting documents where an ITIN is needed. Tax practitioners see this as a partial fix: it speeds filing but does not shorten the verification timeline for ITIN issuance, so refunds and credit eligibility still hinge on the ITIN application’s resolution.
4. Expiration and renewal: how nonuse can force taxpayers back into the queue
ITINs that go unused on a U.S. federal tax return for three consecutive years expire and must be renewed before they are included on a future return; renewal requires completing Form W‑7 and submitting updated documentation, a process the IRS stresses taxpayers should track to avoid rejected returns or withheld credits [7]. This reuse-and-renew rule aims to keep the ITIN database current but places episodic burdens on immigrant and international taxpayers who may file intermittently. The need to renew can create surprise paperwork for families and complicate planning around eligible credits and treaty benefits.
5. Privacy push and technology updates: the IRS is trying to reduce SSN exposure
The IRS is actively reducing the use of Social Security numbers in its systems and correspondence, introducing masked SSNs and internal limits on SSN display to protect taxpayer privacy and reduce identity theft risk [4]. Complementing this privacy agenda, the IRS is evaluating electronic passport verification to streamline W‑7 processing because passports account for a large share of submitted documents; the proposal to verify passports electronically could speed issuance and reduce mailed originals, according to recent evaluations [5]. These measures both advance security and signal institutional priorities toward digital modernization.
6. Conflicting pressures and stakeholder agendas: enforcement, privacy, and service
The IRS faces competing pressures: enforcement and identity‑verification aims push for stricter documentation, while service and access advocates press for easier, faster issuance to allow eligible taxpayers to claim credits timely. Acceptance Agents, commercial tax software, and the IRS each have different incentives—software and preparers promote e‑filing and customer experience [3] [6], Acceptance Agents reduce document mailing burdens [2], and the IRS balances fraud prevention with operational limits, prompting pilots like electronic passport checks [5]. These tensions shape policy details and taxpayer experiences at filing season.
7. Bottom line for taxpayers: immediate steps and realistic expectations
Taxpayers without an SSN should file Form W‑7 with required documentation or seek an Acceptance Agent’s certification, expect processing time and possible renewal needs, and aim to secure an ITIN by filing deadlines if they intend to claim credits [2] [3] [7]. Use of e‑file for returns with mismatches reduces one hurdle but does not replace the W‑7 requirement; taxpayers should preserve documentation, track ITIN expiration rules, and be aware the IRS is gradually adopting digital verification and masking measures to protect privacy and speed some processes [6] [4] [5].