IRS Says that Idle ITINS Expire After 5 Years

The Internal Revenue Service has announced that Individual Taxpayer Identification Numbers (ITINs) will expire if not used on a federal income tax return for five consecutive years. The IRS noted that it will not begin deactivating ITINs until 2016. This new policy applies to any ITIN, regardless of when it was first issued. This will ensure that anyone who legitimately uses an ITIN for tax purposes can continue to do so, while at the same time resulting in the likely eventual expiration of millions of unused ITINs. Only about 25% of the 21 million ITINs issued since the program began in 1996 are being used on tax returns.

This new policy replaces the previous policy in which ITINs would have automatically expired after 5 years, even if used properly and regularly by taxpayers. Under the new policy:

·         An ITIN will expire for any taxpayer who fails to file a federal income tax return for 5 consecutive years.

·         Any ITIN will remain in effect as long as a taxpayer continues to file U.S. tax returns.

·         The IRS will not begin deactivation of unused ITINs until 2016.

·         A taxpayer whose ITIN has been deactivated and needs to file a U.S. tax return can reapply using Form W-7.

For more information, contact us or visit www.IRS.gov.