SASEBO NAVAL BASE, Japan — Base tax lawyers this week urged taxpayers to get Social Security numbers for family members before filing their federal tax returns. Depending instead on Individual Taxpayer Identification Numbers, or ITINs, could lose taxpayers up to $4,120 each, they said.
The reason: Some taxpayers with incomes less than $35,000 can qualify for the Earned Income Tax Credit. The credit reduces the federal tax owed and may result in a refund as generous as $4,120.
But only tax returns filed with Social Security numbers for all dependants qualify for the credit, said Lt. Mary E. Thompson, a tax officer at Sasebo’s Navy Legal Services Office.
Many servicemembers who marry non-U.S. citizens “get an ITIN for their spouse,” said Lt. Randy Vavra, also a tax officer with Sasebo’s NLSO. The IRS issues the ITINs to those not entitled to SSNs but who need an identification number for banking or paying taxes.
ITINs are formatted like SSNs with nine digits, beginning with the number “9.” Servicemembers still can get refunds due them if their spouses have ITINs instead of Social Security numbers, Thompson said — but not the Earned Income Tax Credit.
Forfeiting the EIC could cost you, Vavra said: “You could miss out on up to $4,120 of extra refund.”
But a SSN should be acquired before the tax return is filed. Those who identify dependents with an ITIN on a return, Thompson said, “can’t go back later and correct their taxes hoping to receive the EIC.”
Those people still qualify for their normal refund but not the extra earned-income refund, Vavra said: “It’s just gone.”
Thompson said people don’t qualify for the maximum EIC unless their total annual family income is less than $35,000.
“But I have seen them come in here … and end up with EIC refunds in the $2,000 or $1,500 range; that’s not uncommon,” she said. “When they hear about this, they call wanting to know what to do. This is something they really do care about.”
A taxpayer who marries someone who isn’t a U.S. citizen or permanent U.S. resident, or claims other dependents in those categories, should call the base legal services office at once, Thompson said, to begin the process of getting non-citizen family members permanent-resident status and their green cards. Only then can they qualify for a SSN.
“I cannot stress this enough,” Vavra added.
“The $4,120 is too much money to let just go away.”
— For more information in Sasebo call NLSO at 252-3347.
ITIN facts
The Internal Revenue Service issues ITINs for tax processing only. The numbers are not intended to serve any other purpose, according to the IRS Web site. The numbers:
• Are not valid for identification outside the tax system.• Do not entitle the holder to Social Security benefits or the Earned Income Tax Credit.• Do not establish immigration status.• Do not grant the right to work in the United States. Any individual who is eligible for legal employment in the United States must have a Social Security number.• An ITIN holder enters the ITIN in the space where a SSN is requested on a tax return.— Stars and Stripes
