If you have an H4 visa, that means you’ve traveled to the United States to live with a spouse or parent who is an H1B visa holder. Unlike H1B visa holders, H4 visa holders are not eligible to receive a Social Security Number and therefore cannot file taxes using one.
It’s easy to assume that you can’t file taxes without a Social Security Number, but that’s not the case for H4 visa holders. The IRS requires H4 visa holders to file an annual tax return. In fact, most individuals in the United States, including green card holders, must pay taxes on their worldwide income to the IRS. Even if you do not have any income from a U.S.-based source to report on your tax return, you still have to report foreign income sources and investments.
An Individual Tax Identification Number (ITIN) is a unique 9-digit number issued by the IRS. It is specifically for individuals who are required to file a tax return but are not eligible to obtain a Social Security Number (SSN).
An ITIN is only intended for tax purposes and will not be used for any other purpose. Note that having an ITIN does not change your immigration status or provide work authorization.
Step 1: Get Form W-7. You can get the form online on the IRS website, request one by mail by calling the toll-free assistance number, or get it from an authorized acceptance agent.
Step 2: Fill out Form W-7 (instructions are outlined in the next section).
Step 3: Gather your supporting documents (listed below). You’ll need to provide proof of identity and foreign status, such as a passport and a copy of your H4 visa.
Step 4: Choose how you will submit:
Step 5: Wait seven weeks for your ITIN. The IRS will process your application and will assign you an ITIN.
Step 6: If necessary, you can check the status of your application seven weeks after submitting Form W-7 and your tax return by calling the IRS at 800-829-1040 if you are in the U.S. or 267-941-1000 if you are outside of the U.S.
Important Note: If the tax return you attach to Form W-7 is filed after the return’s due date, you may owe interest and penalties.
The primary document used to apply for an ITIN number is Form W-7. The form must be completed in full and signed by the applicant.
Here is how you’ll fill out Form W-7:
The most challenging part of this form is getting a certified passport. There are other forms of identification available, but they require more documentation.
You might need to obtain an ITIN for your child if they have an income subject to U.S. taxes, are going to be claimed as a dependent on a tax return, have received a gift or inheritance from a foreign source, or are pursuing educational opportunities, applying for health insurance, or opening a bank account.
The process of obtaining an ITIN for a child is similar to obtaining one for an adult:
Additionally, a passport contains an expiration date and a date of entry into the United States, which can be used to establish U.S. residency for those dependents who need to prove it. Passports are also considered secure forms of identification, with multiple security features making them difficult to counterfeit.
It’s worth noting that although a passport is the only stand-alone document, the IRS may require additional documentation in order to prevent fraud or if a passport is expired.
Additional documents could include:
You can apply at any time when you have a filing or reporting requirement. It’s best to apply as soon as possible. This will help you avoid any delays in processing your tax return and ensure that you don’t have to pay penalties or interest if the IRS has not yet assigned an ITIN number.
It’s worth noting that even if you are not currently required to file taxes, it’s still a good idea to apply for an ITIN to have it for future use since it can also be helpful for other purposes such as opening a bank account.
The IRS does not disclose taxpayer information to immigration enforcement agencies without a court order. Any information provided to the IRS through Form W-7 is kept confidential and secure.
However, ITINs do not provide legal work authorization or immigration status; they are only for tax purposes. Therefore, they cannot be used to apply for a driver’s license, state ID, credit card, bank account, housing, or other benefits.
H4 visa holders also need to protect their ITIN information. Remember that the IRS will never contact taxpayers via email, text, or social media. The IRS will not threaten lawsuits or contact you asking for identity protection pins. You should only provide your ITIN to authorized individuals or organizations, such as their tax preparer, and should never give it out over the phone or through email.
In 2018, changes to the tax code under the Tax Cuts and Jobs Act (TCJA) impacted the eligibility of certain tax credits for ITIN holders. One of the most notable changes was the restriction on claiming the Additional Child Tax Credit (ACTC) and the Child Tax Credit (CTC) for children with an ITIN.
Previously, ITIN holders could claim the ACTC and CTC for their children, even if they did not have an SSN. The TCJA also made changes to the refundability of the child tax credit. Before 2018, the Additional Child Tax Credit (ACTC) was refundable, meaning taxpayers could receive a refund even if they didn’t owe any taxes. But the TCJA limited the refundability of the ACTC to 15% of earned income over $2,500.
Filing taxes in the U.S. can be complicated. However, there are benefits to ensuring you remain compliant with U.S. tax laws and regulations. First and most importantly, you avoid fines or penalties for failing to submit an annual tax return.
Additionally, you may be able to claim deductions for expenses such as education, medical expenses, and mortgage interest, which can lower your tax liability. Having an ITIN also makes it easier to open a bank account as it serves as a form of identification.
Another benefit of having an ITIN and filing taxes is that it can help establish a credit history. This can be important if you plan to apply for a loan, a mortgage, or other types of credit in the future. By filing taxes and showing that you have a history of paying taxes, you can demonstrate to lenders that you are a responsible borrower. Lastly, if you have paid more taxes than you owe, you can claim a refund of the taxes withheld from your income.
Whether you’re an H1B, H4, or any other non-citizen visa holder, obtaining an ITIN is an important step to take when living and working in the U.S. The experienced immigration attorneys at Scott D. Pollock & Associates, P.C. are well-versed in the requirements for applying for an ITIN and can help you navigate the application process.
We can guide the documents you need to submit and make sure that your application is filed correctly with the IRS so you can reduce the chances of facing any delays or rejections. Contact us today to learn more about how we can help you get an ITIN.View Similar Articles