The PATH Act and What You Need to Know About Expiring ITINs

Tax News The PATH Act and What You Need to Know About Expiring ITINs

The Protecting Americans from Tax Hikes (PATH) Act of 2015, which was passed by Congress and signed into law in December 2015, requires taxpayers to renew expired ITINs in order to file their taxes. The IRS announced that more than 2 million ITINs are set to expire at the end of 2019.

ITINs that are expected to expire and need to be renewed are:

  • Ones not used at least once in the last three years to file taxes
  • ITINs with middle digits 83 through 87  (xxx-83-xxxx; xxx-84-xxxx, etc)
  • Previously expired ITINs with middle digits 70 through 82

ITINs are used by people who have tax filing or payment obligations under U.S. law, but who do not have and are not eligible for a Social Security number.

If you have an expiring ITIN and need to file your 2019 tax return (the one you file in 2020), the IRS encourages you to submit an ITIN application package to avoid any unnecessary delays and allow for smoother and faster processing of your tax return.

Here are some helpful answers to some common questions around renewing your ITIN.

How do I renew my ITIN?

You can renew your ITIN for free by filling out a Form W-7 and submitting required documentation. Your W-7 application can be submitted via mail to the IRS or you can call and make an appointment at a designated IRS Taxpayer Assistance Center.

Do I have to pay someone to renew my ITIN?

No, you can renew your ITIN for free. You don’t need to pay someone or go anywhere to renew your ITIN. You simply fill out the Form W-7, supply the required supporting documentation, and mail the W-7 application to the IRS.

I heard you have to include your tax return for the current tax year with your ITIN application. Is that true?

No, if you are renewing your existing ITIN, you do not need to send your tax return with the Form W-7 renewal application.

Does everyone with an expiring ITIN have to renew?

No, there are some cases where you would not need to renew like if your ITIN is only used on information returns filed with the IRS by third parties.

What about my spouse and kids? Do they have to renew their expiring ITINs?

Yes, if you are a U.S. citizen or resident alien and you file jointly with your spouse who has an expiring ITIN, your spouse will need to renew their ITIN.

If your kids are eligible to be claimed as dependents on your tax return then their ITINs will also need to be renewed in order to claim certain credits. Under tax reform, the dependent exemption was eliminated from 2018 through 2025. There were also changes to requirements in order to claim the Child Tax Credit. One of the changes relates to the ITIN. Now under the new tax law, you have to have a social security number in order to claim the Child Tax Credit and not an ITIN. You can claim the new Other Dependent Credit (ODC) up to $500 with an ITIN.

How long will it take for the IRS to process my renewal application?

If you apply soon, per the IRS, allow 7 weeks for them to notify you of your ITIN application status. Once tax season opens, processing is expected to take up to 11 weeks, so send in your renewal application as soon as possible to ensure there are no delays in processing your tax return and so you can e-file your tax return.

What happens if I didn’t renew my expired ITIN and try and file my return? 

If you file your tax return with an expired ITIN you may experience processing delays and possible loss of eligibility for some tax benefits until your ITIN is renewed. However, once you renew your ITIN, these potential tax benefits will be reconsidered.

Don’t worry about keeping up on the latest tax laws. TurboTax has you covered and will ask you simple questions and give you the tax deductions and credits you’re eligible for based on your answers. If you have questions, you can connect live via one-way video to a TurboTax Live CPA or Enrolled Agent to get your tax questions answered. TurboTax Live CPAs and Enrolled Agents can also review, sign, and file your tax return.

Leave a Reply