For years, despite being a married expat, I filed my taxes as “married filing separately,” unknowingly missing out on some major tax breaks.
It wasn’t until a few years ago when I discovered that I could get an International Tax Identification Number (ITIN) for my non-U.S. wife, add her to my taxes, and opt for the maximum standard deduction when filing my U.S. federal income taxes.
This has helped me save thousands of dollars on taxes I would have had to otherwise pay if I filed as “married filing separately” or as “head of household.”
If you’re looking to do the same thing, this guide will show you how to apply for an ITIN for free or through an IRS-approved Acceptance Agency and reap the tax benefits whether tax season is upon you or months away.
With that said, this process will work for expats married to non-U.S. citizens anywhere in the world.
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What is an ITIN?
An ITIN is a nine-digit number similar to a Social Security Number that is assigned by the IRS to non-U.S. citizens, who for one reason or another, have to file U.S. federal income tax returns or have their names added to someone else’s returns.
In some cases, ITINs are assigned to people who register businesses in the U.S. but don’t actually live there.
This article will focus on the former reason.
Who Needs to File for an ITIN?
Most of the time, if you’re married to a non-U.S. citizen and want to reap the tax benefits of filing “married filing jointly,” your spouse must have an ITIN.
With that in mind, anyone married to a U.S. citizen who is looking for tax breaks needs an ITIN.
Keep in mind that if you file your taxes but don’t list your non-U.S. spouse on the returns, or don’t get a ITIN for him or her, you won’t be penalized. You will, however, miss out on the tax breaks.
What is an ITIN Used For?
ITINs help in two ways.
First, an ITIN gives you more tax breaks when filing your federal income taxes.
Second, it helps to have an ITIN for your spouse if you ever want him or her to live in the U.S. with you.
Let’s look at each one more closely.
When you apply for an ITIN for your spouse, you can then file your federal income taxes as “married filing jointly,” which gets you a standard deduction of US$24,800 at the time of this writing.
That’s a lot more than the standard deductions for “married filing separately” or “head of household,” which get you only US$12,400 and US$18,650, respectively.
Another benefit to getting an ITIN for your spouse is that if—or when—you move back to the U.S., it will look better on your spouse’s visa application if you’ve been listing them as your spouse on your federal income tax returns.
How to Get an ITIN
Generally speaking, you can apply for your spouse’s ITIN by either doing the paperwork yourself for free, or by hiring an Acceptance Agent to do it for you.
Let’s look at the free option first.
The easiest way to apply for an ITIN is to fill out the W7 form and mail it to the IRS when you file your federal income taxes.
To do so, take the following steps:
- Download Form W–7 and the instructions
- Fill out Form W–7 according to the instructions
- Attach Form W–7 to the front of your federal income tax returns
- Include one or more original or certified documents to prove your spouse’s identity (you don’t have to prove you’re married, surprisingly enough)
You must mail Form W–7 and your federal income tax returns to:
- ITIN Operation
- P.O. Box 149342
- Austin, TX 78714–9342
When I applied for my wife’s ITIN, I went with the free option, and because it was right around tax season, I sent my wife’s original Thai passport to prove her identity.
At the time, I didn’t have the chance to get certified copies made or find a Thai translator.
My wife’s ITIN was approved in just under two months and her passport was mailed back to Thailand.
If you’re not comfortable applying for an ITIN for your spouse, you can hire an IRS-approved Acceptance Agent to file for you.
Keep in mind, however, that having someone file for an ITIN for you is not cheap. You’ll pay well over US$500 in some cases.
In fact, the highest quote I got from a company in Thailand was US$800.
Can I Apply for ITIN Online?
Keep in mind that you cannot apply for an ITIN online, so be wary of any companies claiming that they can get you one online in a relatively short amount of time.
With that said, there are certified companies all over the world mentioned in the previous section that can file for your spouse’s ITIN for you.
Do ITINs Expire?
ITINs don’t last forever, but they are good for five years.
When your spouse gets his or her first ITIN, it will expire on 31 December of the fifth year – it doesn’t matter what month the ITIN was activated in.
Renewing an ITIN
When it’s time to renew your spouse’s ITIN, you have to go through the same process outlined in the section above on How to Get an ITIN.
Is an ITIN the Same as a SSN?
ITINs and SSNs are two different things.
ITINs don’t grant anyone permission to work in the U.S., collect Social Security benefits, or qualify anyone for earned income tax credits.
In most cases, a SSN does provide the benefits above.
Now, on to You
Applying for an ITIN for your non-U.S. husband or wife isn’t very difficult.
But if you do so, apply as early in the year as possible so that you already have the ITIN to add to your 1040s.
Alternatively, you can do what I did and apply when filing your U.S. federal tax returns, but keep in mind that it will take a lot longer for the IRS to process your returns if you go this route.