UNITED STATES IS A MELTING POT COMPOSED OF PEOPLE representing more than 150 nations. According to the U.S. Census Bureau, in 2013 over 1.9 million New Jersey residents were born abroad, the fifth-largest immigrant population in the country.While 53 percent were naturalized U.S. citizens, the remainder, over 1 million people,still have tax obligations while residing in the U.S. However foreign taxpayers are not eligible for a Social Security Number (SSN) most of the time. This makes the tax filing process difficult.
Unlike SSN, which is issued by the Social Security Administration(SSA), IRS issues an Individual Taxpayer Identification Number(ITIN) to be used by non-resident and some resident aliens,including spouses and other dependents who cannot get SSN,to file taxes, claim tax treaty benefits or on withholding certificate for the beneficial owner. It’s important to note that ITIN does not change the individual’s immigration status or serve as work authorization and does not qualify the individual for the Earned Income Tax Credit (EITC) or Social Security benefits.
In order to receive an ITIN, the individual must apply by filing Form W-7 and verify their foreign/alien status as well as their true identity. This is done by either mailing the documents with their tax return if applicable to the ITIN processing center in Austin, TX, visit local IRS office or get help from an Acceptance Agent (AA). The job of the AA is to review the documents and ensure that all the necessary components are present in order to qualify before mailing off the application and signing off at the bottom of Form W-7.
However, often sending original documents can be risky because of the possibility of loss. This is especially important for political asylum applicants who need to file a tax return while their immigration case is pending with USCIS, as their passport maybe the only form of identification. Although not everyone relishes the opportunity to visit an IRS office, an alternative may be to visit a local IRS office to certify the documents. For this purpose, the IRS expanded the Acceptance Agents program toallow for another designation, that of the Certifying Acceptance Agent (CAA). The CAA authenticates all the original documents, fills out Certificate of Accuracy (COA) for the IRS ITIN Form W-7 after conducting an in-person interview(videoconferencing is acceptable as long as original document is in the possession of the CAA) and sends it with copies of the original documents or certified copies from the agency that issued them (notarized documents are not accepted for ITIN applications). These are mailed together with the tax return if applicable, allowing the applicant to obtain a valid ITIN without the risks involved with sending original documents in the mail.
So how does one become a CAA? The IRS is currently recruiting CAAs, which can be a person or an entity, to serve communities with high ITIN usage and as such Form 13551 application for the Acceptance Agent is accepted year-round. Once approved, IRS mails an agreement to be signed by the CAA, which expires on Dec. 31st of the 4th year of the agreement and assigns an Acceptance Agent Office Code to be used on W-7 COA. Each AA/CAA must submit at least 5 ITIN applications annually. The IRS may conduct compliance review to make sure you are compliant with the program. To help AA’sand CAA’s, IRS mails Form 14154, which includes a checklist and an AA Guide for ITIN to help practitioners correctly fulfill their duties as well as educate their clients.IRS also provides a direct phone number to the ITIN Processing Unit which is only available to AA’s and CAA’s.
Becoming a CAA is a great opportunity to provide specialized services to a very large and under-served group. In this position you are able to improve compliance while simplifying the application process for your clients. It is difficult enough to immigrate to a new country and adjust to its respective rules and regulations, your service will allow them to sleep easy knowing that there is no longer a risk of losing the valuable original documentation while meeting deadlines and their tax obligations.
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a qualified tax professional, CAA has been a NATP member since 2016. Dmytro runs a qualified tax professional located in NYC and Fair Lawn, NJ,which specializes primarily in tax representation and tax planning services. He can be reached at
Written by Tax Professionals