IRS Helps Taxpayers Avoid Refund Delays

WASHINGTON - The Internal Revenue Service has mailed a tax tip to over 300,000 taxpayers, alerting them that the identification numbers they used on their last tax returns could delay their refunds next year. As a convenience, the mailing also contained the forms to be used to apply for appropriate identification numbers.

The IRS letter explained that the law now requires every individual listed on a tax return to have either a social security number (SSN) or an Individual Taxpayer Identification Number (ITIN). The ITINs, which the IRS issues, are new this year. The IRS can no longer accept temporary numbers, "applied for" or other designations in lieu of the required numbers.

The mailing included Form SS-5, used to apply for an SSN from the Social Security Administration, and Form W-7, used to apply for an ITIN from the IRS. U.S. citizens and aliens who have been lawfully admitted for permanent residence or employment must obtain SSNs. Those who do not qualify for SSNs but who need identification numbers for federal tax purposes must obtain ITINs. Taxpayers needing ITINs should give themselves at least a month before they plan to file their tax returns to obtain the numbers.

Failure to put valid numbers on a tax return may mean a delay or reduction in any refund claimed. If an invalid number is used for a taxpayer or spouse, the IRS may delay the refund until it resolves the matter. If the incorrect number is for a dependent, the IRS may disallow related items such as the personal exemption, child care credit, or earned income credit and the taxpayer will receive either a smaller refund or a tax bill. When claiming the earned income credit, only SSNs, not ITINs, may be used by the taxpayer, spouse or qualifying child.

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