How to Renew ITIN

Some Individual Taxpayer Identification Numbers (ITIN) expire at the end of 2016. The IRS issues an ITIN to those who have a filing or reporting requirement but don’t have and are not eligible to get a Social Security number. If you need to renew your ITIN, you should submit a complete application this fall to avoid delays.


What Document do you need to renew ITIN

The following list includes the documents you’ll need to renew your ITIN:


Form W-7

1. Form W-7. You must submit a completed Form W-7, Application for IRS Individual Taxpayer Identification Number (Rev 9-2016). You don’t need a completed tax return for the renewal application. You must include the identification documents with the form.

Proof of foreign status and identity

2. Proof of foreign status and identity. Several documents satisfy this requirement. These are:

  • Passport. (Note: You can use a passport as a stand-alone document for dependents with a U.S. date of entry. Otherwise, an additional ID from the list below is required)
  • National ID card (must show photo, name, current address, date of birth and expiration)
  • U.S. driver’s license
  • Birth certificate (required for dependents under 18)
  • Foreign driver’s license
  • U.S. state ID card
  • Foreign voter’s registration card
  • U.S. military ID card
  • Foreign military ID card
  • Visa
  • U.S. Citizenship and Immigration Services (USCIS) photo identification
  • Medical records (only dependents under 6)
  • School records (dependents under 14, or under 18 if a student)

Only original documents or copies certified by the issuing agency are accepted. If you would rather not mail original documents, you may use the IRS Certified Acceptance Agent (CAA) Program or make an appointment at a designated IRS Taxpayer Assistance Center.

Dependent requirements

3. Dependent requirements. If you need to renew your ITIN, you have the option to renew ITINs for your entire family at the same time. For dependents from countries other than Canada or Mexico or dependents of U.S. military members overseas, a passport with a U.S. entry date may serve as stand-alone identification. Along with the passport, dependent applications require:

  • U.S. medical records for dependents under age 6, or
  • U.S. school records for dependents under age 18
  • U.S. school records for dependents age 18 and over or,
    • Rental statement with the applicant’s name and U.S. address or
    • Utility bill with the applicant’s name and U.S. address or
    • Bank statement with applicant’s name and U.S. address

To claim certain credits and to receive a timely refund, renew your ITIN before you file your taxes.

U.S. Persons Residing Abroad Claiming Additional Child Tax Credit

Taxpayers residing abroad are filing returns claiming refundable credits, such as the Additional Child Tax Credit. These taxpayers have often never resided or resided only for a short period of time in the U.S. and some have no plans to return to the U.S. Some of these taxpayers are only filing a U.S. return to get the refundable credits. In a significant number of instances, the taxpayers are not entitled to the credits because the “qualifying” children were not U.S. persons during the years at issue and/or income was misstated.


Who is considered a U.S. Citizen?

A Social Security Card does not establish United States citizenship or residency. The taxpayer(s) must provide a U.S. Birth Certificate, Consular Report of Birth Abroad, Certificate of Citizenship (which is effective from the date of issuance), valid green card or U.S. Passport. Note that a U.S. Passport issued after the year under audit does not necessarily indicate that the individual was a U.S. citizen or lawful permanent resident during the tax year under audit.


Non-U.S. Citizen Spouses

If one spouse is not a U.S. citizen, in order to file a joint return he or she must provide proof that he or she filed a section 6013(g) election with his or her spouse. There are limitations on the credits based on modified adjusted gross income and further limits on the refundable portion of the credit (also known as the Additional Child Tax Credit) based on taxable earned income.There are further limits on the refundable portion of the credit (also known as the Additional Child Tax Credit) based on taxable earned income. The term “earned income” is as defined in IRC § 32(c)(2)and does not include any amount excluded under IRC § 911, I931, or 933.


Misclassified on the tax return

If income was misclassified on the tax return – e.g., unearned income (such as a stipend, scholarship, or income received pursuant to a communal living arrangement) was reported as earned, properly reclassify the income and make the proper adjustments to all affected items, including credits.If the taxpayer(s) failed to provide documentation evidencing the nature, source and amount of income, disallow the claimed credits.

IRS Help for International Taxpayers

By law, Americans living abroad, as well as many non-U.S. citizens, must file a U.S. income tax return. In addition, key tax benefits, such as the foreign earned income exclusion, are only available to those who file a U.S. return. These online resources and videos are designed to help affected taxpayers understand how these rules apply to them.


U.S. citizens and resident aliens must worldwide income

Federal law requires U.S. citizens and resident aliens to report worldwide income, including income from foreign trusts and foreign bank and securities accounts. In most cases, affected taxpayers need to complete and attach Schedule B to their tax return. Part III of Schedule B asks about the existence of foreign accounts, such as bank and securities accounts, and usually requires U.S. citizens to report the country in which each account is located.


Paying U.S. Taxes on Worldwide Income

If you are a U.S. citizen or a resident alien of the United States and you live abroad, you are taxed on your worldwide income. However, you may qualify to exclude from income up to an amount of your foreign earnings that is adjusted annually for inflation ($92,900 for 2011, $95,100 for 2012, $97,600 for 2013, $99,200 for 2014 and $100,800 for 2015). In addition, you can exclude or deduct certain foreign housing amounts.


US Taxpayers with Foreign Accounts

Taxpayers with an interest in, or signature or other authority over, foreign financial accounts whose aggregate value exceeded $10,000 at any time during 2015 must file with the Treasury Department a Financial Crimes Enforcement Network (FinCEN) Form 114, Report of Foreign Bank and Financial Accounts (FBAR). It is due to the Treasury Department by June 30, 2016, must be filed electronically and is only available online through the BSA E-Filing System website. For details regarding the FBAR requirements, see Report of Foreign Bank and Financial Accounts (FBAR).

U.S. taxpayers with foreign accounts should also understand their reporting requirements under the Foreign Account Tax Compliance Act (FATCA). Third-party information reporting from foreign financial institutions or through intergovernmental agreements began in 2015.


Information about FATCA Law

In addition, under FATCA, certain U.S. taxpayers holding financial assets outside the United States must report those assets to the IRS on Form 8938, Statement of Specified Foreign Financial Assets.  Generally, U.S. citizens, resident aliens and certain non-resident aliens must report specified foreign financial assets on this form if the aggregate value of those assets exceeds certain thresholds. Reporting thresholds vary based on whether a taxpayer files a joint income tax return or lives abroad. See the instructions for Form 8938 for more information.


Filing Taxes as an American Expat

To help avoid delays with tax refunds, taxpayers living abroad should visit the Helpful Tips for Effectively Receiving a Tax Refund for Taxpayers Living Abroad page.

The IRS has also added two new international tax topics to Tax Trails, the agency’s interactive online tool that helps taxpayers get answers to their general tax questions. The two topics involvefiling requirements and filing status of a U.S. citizen or resident alien married to a nonresident alien.


Information for US Expat Taxpayers

The International Taxpayers page on is packed with information designed to help taxpayers living abroad, resident aliens, nonresident aliens, residents of U.S. territories and foreign students. The web site also features a directory that includes overseas tax preparers.
“These resources provide critical information to assist taxpayers with many different needs,” said IRS Commissioner John Koskinen. “Tax issues can be even more challenging for international taxpayers, and provides important details they need to understand their obligations.”


IRS Forms for Expat and International Taxpayers


International Contact for IRS

Taxpayer service, formerly offered at the foreign posts of duty, is no longer available.  Please send your tax forms and correspondence to the applicable address indicated below.

Individual taxpayers located outside the U.S. may also contact the IRS by mail at:

Internal Revenue Service
International Accounts
Philadelphia, PA 19255-0725

Business taxpayers located outside the U.S. may also contact the IRS by mail at:

Internal Revenue Service
International Accounts
Ogden, UT 84201-0038

IRS Tax Tips for foreigners resident and non-resident taxes

If you are not a U.S. citizen, if you live in the United States or spend a significant amount of time there, you still have to pay the tax on the income of U.S.


Foreign resident or non-resident

The IRS uses two tests, the green card test and the substantial presence test, to evaluate your foreign status. If you meet the requirements of any of them, is considered you a resident alien for tax purposes, otherwise, you are treated as a nonresident alien.

Filing Taxes as a Green Card Holder

If you are an alien with a green card, i.e., when the United States citizenship and immigration service allow you to legally reside in the country, you are a resident alien. However, if you do not have a green card and spend at least 31 days in the United States during the fiscal year in progress and a total of 183 days, during the last three fiscal years (including the current fiscal year), chances are that you fulfill the requirement of physical presence and also to be treated as a resident alien.


Counting 183 days in U.S.

To count the number of days that you are present in the United States during the period of three years, you don’t have to include every day. Instead, it has only a fraction of the days in two of the three years. Suppose, for example, that you are trying to find out your status for the 2012 fiscal year, since you lived in the United States for 60 days. It has 60 days to 2012, one-third of the days in 2011 and a sixth of the days in 2010. Therefore, if you were in the U.S. during 120 days in 2011 and 180 days in 2010, includes only 40 days for 2011 and 30 days in 2010, with the total for the period of three years, being 130 days. In this scenario, it pays tax to income as a non-resident alien.


IRS Physical Presence Test for Non-Resident Aliens

In addition, are not taken into account the days that are physically present in the United States under the following circumstances:
  • Day you come to work in the United States from a residence in Canada or Mexico, if regularly coming from Canada or Mexico.
  • Days you are in the United States for less than 24 hours when you’re in transit between two places outside the United States.
  • Days you are in the United States as a member of the crew of a foreign ship.
  • Days that you can not leave the United States because of a medical condition that arose during your stay.
  • Days that you’re a ‘free individual’.

A ‘free individual’ for the purposes of this essay refers to the following people:


  • An individual temporarily present in the United States as an individual of a foreign Government under an “A” or “G” visa.
  • A teacher or learner temporarily in the United States under a visa “J” or “Q”, which substantially complies with the requirements of the visa.
  • A student temporarily in the United States under a visa “F”, “J”, “M” or “Q”, which substantially complies with the requirements of the visa.
  • A professional athlete temporarily in the United States to compete in a sports charity event


U.S. Taxes for Foreign Residents

As a legal U.S. resident, you are subject to the tax rules for U.S. citizens. This means that you have to report all the income you earn in annual tax, irrespective of the country in which you win it. To prepare your return, you can always use the 1040, or if you are eligible, 1040A or 1040EZ.

U.S. Taxes on non-residents

A non-resident must also pay income taxes to the IRS, but only on the income which is effectively connected to the United States, which generally includes the money that wins, while in the United States However, the IRS has no authority to impose taxes on income that non-residents earn in their countries of origin or in any foreign country for this case. Prepare your U.S. tax return, you must use the form 1040NR or one short as the 1040NR-EZ if you are eligible. Regardless of the form that you use, you informed only of the quantities which are considered U.S. source income. As well as resident aliens and U.S. citizens, there are deductions and credits that you can claim to reduce your taxable income.

Double condition of taxpayers

In the year of transition between being a non-resident and a resident for tax purposes, is considered generally a taxpayer in State Dual. A taxpayer in State Dual presents two tax returns for the year, a statement for the portion of the year that was considered a non-resident and the other by the portion of the year considered a resident. In some situations, the taxpayer may choose to be treated as resident throughout the year in the year of transition to avoid having to file two separate statements

IRS Upgrades, Enhances FATCA Registration System

The IRS upgraded the Foreign Account Tax Compliance Act (FATCA) Online Registration System, enabling sponsoring entities to register their sponsored entities to obtain a global intermediary identification number. The upgraded system also will allow users to update their information, download registration tables and change their financial institution type. The upgrade also includes an updated jurisdiction list.


What is the FATCA Registration System?

The Foreign Account Tax Compliance Act (FATCA) Online Registration System is a secure, web-based system that financial institutions and other entities can use to register for FATCA purposes. Launched in 2013, the system allows the IRS to identify foreign financial institutions and certain other entities with FATCA obligations. These entities generally report on foreign financial accounts held by U.S. taxpayers under the terms of FATCA or pursuant to the provisions of specific intergovernmental agreements (IGAs).


What is FATCA?

“The registration system is the backbone of FATCA,” said IRS Commissioner John Koskinen. “These upgrades improve the FATCA process, enabling the registration of sponsored entities and making it easier for registrants to use. Working with financial institutions and through intergovernmental agreements, our progress against undisclosed foreign accounts continues.”


Who must Register with IRS?

More than 170,000 financial institutions worldwide have registered with the IRS. These financial institutions are located in more than 200 jurisdictions. In most cases, those foreign financial institutions that do not comply with FATCA or participate through an IGA are subject to 30 percent withholding on certain U.S. source payments.

FATCA requires certain sponsored entities (including those covered by an IGA) to have their own Global Intermediary Identification Number (GIIN) for FATCA reporting and withholding purposes by Dec. 31, 2016. To facilitate this requirement, the FATCA Online Registration System will now enable sponsoring entities to add their sponsored entities and, if applicable, sponsored subsidiary branches. These entities can be added either individually or by submitting a file containing information for multiple entities.

The IRS also provides a Microsoft Excel-based Sponsored Entity Data Preparation Tool for users choosing the multiple record file upload option.  As a result of the new sponsored entities and sponsored subsidiary branches, the values available for the GIIN have been expanded.  See the Instructions for Sponsored Entity Data Preparation Tool for XML File for the definitions of sponsored entities and sponsored subsidiary branches.


Updates to FATCA Registration System

The update to the system occurred on November 16. The improvements to the system and additional features to manage user accounts include the following:

  • New questions have been added, such as asking foreign financial institutions to indicate their tax identification number in their country or jurisdiction, if they have one. Other questions relate to identifying the common parent entity of the expanded affiliated group.
  • Certain financial institutions can now change their “Financial Institution Type.”
  • Member financial institutions can now transfer to another expanded affiliated group without having to cancel their current agreement and re-register.

Following the change or transfer, a new FATCA account will be created with existing registration information, including branches.

The FATCA Online Registration System User Guide and FAQs have been updated for these enhancements. Additional information on this system is available at

Election by nonresident alien spouse to file joint tax return with U.S. citizen

In general, a person who is a nonresident alien at the end of the tax year and who is married to a U.S. citizen or resident may elect to be treated as a U.S. resident for income tax purposes, if both spouses so elect. To qualify for the election, you, as a U.S. citizen or resident spouse need to be a U.S. citizen or resident only at the close of the tax year.


What happens with a non-resident spouse on a tax return?

As a result of the election:

  • you and your nonresident alien spouse agree to be subject to tax on your worldwide income;
  • you may claim a personal exemption for your spouse;.
  • you may claim deductions for items that were paid by your spouse which would not otherwise be deductible by you if you filed a separate income tax return;
  • your income would be subject to tax at the rates for married taxpayers who file joint returns;
  • any exempt income of your nonresident alien spouse from a public international organization remains tax exempt;


Non-resident spouse on a tax return

In effect, if you make the election, you may be subject to income tax at a lower tax rate than if you had not made the election and you filed a separate income tax return. The election is made by attaching a statement to your joint income tax return for the first tax year for which the election will apply. The statement must contain a declaration that you are making the election and the names, addresses and taxpayer identifying numbers of both you and your spouse. In addition, both you and your spouse must sign the election statement. Whether the election will be advantageous to you depends on your

FBAR Due June 30 2015

If you have a financial interest in or signature authority over a foreign financial account, including a bank account, brokerage account, mutual fund, trust, or other type of foreign financial account, exceeding certain thresholds, the Bank Secrecy Act may require you to report the account yearly to the Department of Treasury by electronically filing a Financial Crimes Enforcement Network (FinCEN) 114, Report of Foreign Bank and Financial Accounts (FBAR). See the ‘Who Must File an FBAR’ section below for additional criteria.


Who must file FBAR?

The law states that U.S. persons having a financial interest in or signature authority over one or more foreign financial accounts – including a bank account, brokerage account, mutual fund, trust, estate, pension, cash-value life insurance or other type of foreign financial account – having an aggregate value exceeding $10,000 at any time during 2014 are generally required by the Bank Secrecy Act to report their interest in the account by electronically filing by June 30, 2015 using FinCEN Form 114, ”Report of Foreign Bank and Financial Accounts” (FBAR). A U.S. person may have a reporting obligation even though the foreign financial account does not generate any taxable income.


What is FinCEN Form 114

Effective October 1, 2013, FinCEN Form 114 must be filed electronically via the US Department of the Treasury’s Financial Crimes Enforcement Network website at its Bank Secrecy Act (BSA) E-Filing System. If the US person uses a paid preparer to e-file on their behalf, Form 114a, Record of Authorization to Electronically File FBARs, must be complete before their FBAR is filed online and the paid preparer must maintain the form in their records in case it is requested by FinCEN. Registration is required through the BSA E-Filing System. The US person can complete the registration if they file the form, or tax practitioners can register and e-file on behalf of their clients.


E-Fil FinCEN Form 114 (New FBAR)

FinCEN is attempting to make the new e-filing user friendly. The mandatory e-filing requirement information, capability to register and to upload completed FBARs, and new Form 114 for those individuals and businesses that must file an FBAR is accessible through the BSA e-file website.


Form 1042 and Form 1042-S

A withholding requirement relates to an amount required to be deducted and withheld from the payment of income paid to a foreign person. Withholding agents will report payments to foreign persons of U.S. sourced FDAP income and/or income generally subject to withholding using the Forms:

  • Form 1042
  • Form 042-S,
  • and Form 1042-T

The Form 1042, Annual Withholding Tax Return for U.S. Source income of Foreign Persons, is submitted to the IRS to report the total aggregate of NRA payments, withholdings, and deposits made by the US withholding agent during the year.


A U.S. withholding agent must file a Form 1042 if:

  • You are required to file Form 1042-S (whether or not any tax was withheld or was required to be withheld), or
  • You pay gross investment income to foreign private foundations that are subject to tax under section 4948(a) of the Code.


What is the Purpose of Form 1042

File only one Form 1042, consolidating all information from the foreign recipient’s Form 1042-S, regardless of the number of different recipients, branches, divisions, or types of income for which you are the withholding agent. The frequency of your deposit requirements are determined by the amount of tax that is required to be withheld. See Publication 515 for the specific rules for the Form 1042, including due dates, which forms to use, electronic deposit requirements, and penalties for failure to make deposits timely.


More Info on Form 1042

Do not attach paper Forms 1042-S with your Form 1042. The Form 1042-S is filed separately with the 1042-T. The Form 1042-S, Foreign Person’s U.S. Source Income subject to withholding, is an information return. It is important to note that there is no minimum amount that triggers the filing requirement for a 1042-S. All payments should be reported. This form is required even if the entire amount of compensation is exempt under a tax treaty.


Use the Form 1042-S to report payments that are:

  • exempt under a tax treaty,
  • compensation for personal services performed in the US,  scholarships, fellowships, grants, or financial aid paid to nonresident aliens that are not a “qualified scholarship,”
  • and rents.


What is Form 1042-T?

A separate form is required for each foreign recipient who receives such income. And withholding agents filing paper forms must use a separate Form 1042-S for the specific type of income. Form 1042-T, Annual Summary and Transmittal of Forms 1042-S, should be used to transmit the paper Forms 1042-S to the IRS.

Form W-8ECI exemption from withholding

The W-8ECI is to be used by a foreign person to claim exemption from withholding when the payee has effectively connected income. The form W-8ECI cannot be used by a nonresident alien individual with personal service income. A valid form W-8ECI must include a U.S. TIN or it is invalid. A U.S. TIN is defined as a social security number, employer identification number or IRS individual taxpayer identification number (ITIN).


IRS Form W-7

The Form W-7 is used to apply for an ITIN. Forms W-8BEN and W-8ECI that do not have a U.S. TIN will remain in effect from the date the form is signed and ending on the last day of the 3rd succeeding calendar year received unless a change in circumstances makes any information on the form incorrect. For example, if the form was received on September 30, 2010, it will remain in effect until December 31, 2013. Form W-8BEN with a U.S. TIN will remain in effect until a change in circumstances makes any information on the form incorrect, provided the withholding agent reports on Form 1042-S at least one payment annually to the beneficial owner who provides the W- 8BEN form.


What is Form W-8?

Foreign persons who provide certain series W-8 forms are exempt from backup withholding and Form 1099 reporting.


U.S. Withholding Agent Presumption Rules

Remember a US withholding agent must withhold at 30 percent unless the payment can be associated with a document to support lower rates or exemption from withholding. The Code requires that the document offered by the foreign persons be valid in order to be relied upon by the withholding agent. If the withholding agent cannot reliably associate a payment with valid documentation, the agent must use the “Presumption Rules” provided in the Code. If the withholding agent complies with the Presumption Rules he will not be liable for tax, interest, or penalties even if the rate of withholding that should have been applied … based on the payee’s actual status is different from that presumed and withheld.


The Presumption Rules apply to the determination of

  • The status of the person you pay;
  • Whether the payee is a beneficial owner or intermediary;
  • Whether the payee is a individual, corporation, partnership, or trust.


Using Form W-8ECI

Form W-8ECI should be used by a foreign vendor to certify that the payment is income that is effectively connected with a U.S. trade or business. No withholding is required on such income – because that income should be reported on the foreign vendor’s U.S. business’ income tax return. The Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual, is used by a NRA to claim a tax treaty exemption from withholding of taxes. The form is used to claim a withholding exemption on some or all income from independent contractor services, wages, personal services income and non-compensation scholarship or fellowship income. Also, the Form 8233 is used to claim a personal exemption amount to reduce independent personal services income. This form generally requires a SSN, however, an ITIN may be used.


Claiming Tax Treaty Exemption on Withholding

To claim a tax treaty exemption the NRA provides three copies of the Form to the U.S. payer, that is the withholding agent. The U.S. withholding agent should review and sign the certification in Part IV if he or she is satisfied that the claim is correct. The U.S. withholding agent then mails one copy of the Form with all attachments submitted by the nonresident alien individual to the IRS within five days of receipt of the claim. After mailing the Form to the IRS, the U.S. withholding agent must wait at least 10 days to see if the IRS has any objections.

Claiming Tax Treaty Exemption

If the U.S. withholding agent is later notified by the IRS with objections to the NRA’s claim, the agent must begin withholding immediately. Form 8233 must be completed by the nonresident alien individual and filed by the U.S. withholding agent annually.

Withholding Tax for Nonresident Alien

What should a U.S. employer do when receiving documentation and paperwork from a nonresident alien who has not satisfied all of the requirements of the W-4? Remember: A nonresident alien who fails to file a valid Form W-4 must have federal income taxes withheld at the single status, zero withholding allowances rates. U.S. employers should advise nonresident aliens to review IRS Notice 1392, Supplemental Form W-4 Instructions for Nonresident Aliens, before completing the Form W-4. U.S. employers should know that nonresident aliens.


Information about  Form W-4 for Employers

  • Cannot write “exempt” on line 7 of the Form W-4; and • May only claim “single” for their filing status on line 3 of Form W-4, regardless of their actual marital status.
  • With limited exceptions, a nonresident alien cannot claim more than one withholding allowance on their W-4.
  • And, finally, they are required to write “Nonresident Alien” or “NRA” above the dotted line of line 6.

How does a U.S. employer calculate the amount to be withheld for a nonresident alien?


Wage Withholding for Non-Resident Aliens

Because the wage withholding tables are designed for U.S. citizen employees, a standard deduction amount is built into the calculation. Because a nonresident alien employee is not entitled to the standard deduction, use of the tables for a nonresident alien would result in under-withholding on income tax calculations unless an adjustment is made. To solve this problem, the IRS introduced a gross-up procedure for payroll processing effective January 1, 2006.


Calculate how much income tax to withhold from the wages of a NRA

There are two steps required to calculate how much income tax to withhold from the wages of a NRA. Publication 15 provides a chart showing the additional amount to be added to wages for calculating income tax withholding on individuals not eligible for the standard deduction. The first step is to add the adjustment found in Pub. 15 to the amount of wages paid to the nonresident alien employee. The second step uses the adjusted amount from Step 1 and the number of withholding allowances claimed (usually limited to one allowance) on the W-4 to figure out the withholding from the tables used for all employees.


Tax Effect of W-4

The employer should explain to their nonresident alien employees that the amounts added under the chart are solely for the purpose of calculating federal income tax withholding and nothing else.

  • The chart amounts are not included in any box on the employee’s Form W-2;
  • They do not increase the Federal income tax liability of the employee;

Nonresident Aliens and Form W-4

To claim an exemption under a tax treaty, the nonresident alien individual must file a Form 8233 with their employer. Form 8233 is used by non resident alien individuals to claim exemption from withholding on compensation for personal services because of an income tax treaty or the personal exemption amount.