Even if you don’t have a Social Security Number (SSN), you may still be required to file U.S. taxes. If that is the case, you must apply for an Individual Taxpayer Identification Number (ITIN), which will allow you to file taxes without an SSN. Just like a standard tax return, ITIN holders will need to report their earnings and may be eligible for some tax credits. However, there are specific limitations and differences in eligibility for taxpayers using an ITIN vs. SSN to file their taxes.
Here’s a quick breakdown on what tax credits ITIN filers can claim:
What is an ITIN?
An ITIN is a tax processing number issued by the IRS for individuals who need a taxpayer ID number but are not eligible for a Social Security Number (SSN) from the Social Security Administration.
ITINs are designed to help individuals comply with tax laws. ITINs may be issued regardless of immigration status to both resident and non-resident aliens. However, ITINs are for tax purposes only and do not authorize work in the U.S. or provide eligibility for Social Security benefits.
What tax credits can ITIN filers claim?
ITIN holders can file for a number of common tax credits just like SSN holders. Below is a list of common tax credits ITIN filers can claim along with a review of the specific limitations that apply to ITIN tax filers.
Child Tax Credit (CTC)
The Child Tax Credit is only available for ITIN taxpayers with dependent children who have their own SSNs. If your children do not have SSNs, you cannot claim them under the CTC. (This requirement is in effect through 2025).
To qualify, the dependent child must be a U.S. citizen, U.S. national or U.S. resident alien under age 17 by the end of the tax year. Your modified adjusted gross income must be $400,000 or below (married filing jointly) or $200,000 or below (all other filers).
For 2023, the Child Tax Credit is worth up to $2,000 per qualifying dependent. Up to $1,600 is refundable (also known as the Additional Child Tax Credit).
Child and Dependent Care Credit (CDCTC)
The Child and Dependent Care Credit (CDCTC) is a non-refundable tax credit for parents or caregivers with caregiving expenses, such as day care or care for a spouse or adult dependent who can’t care for themselves.
The credit is calculated based on your income and a percentage of the expenses you incur for the care of qualifying persons—typically between 20% to 35% of up to $3,000 (for one qualifying dependent) or $6,000 (for two or more qualifying dependents).
To qualify for the credit, your child and dependent care expenses must be work related. This means your expenses must
- Allow you (or your spouse if filing jointly) to work or look for work.
- Be for a qualifying person’s care.
Unlike the CTC, you can claim the Child and Dependent Care Credit for dependents who have their own ITIN.
American Opportunity Tax Credit (AOTC)
The American Opportunity Tax Credit (AOTC) is a credit of up to $2,500 for qualified education expenses paid for an eligible college student. If the credit brings the amount of tax you owe to zero, you can get 40% of any remaining amount of the credit (up to $1,000) refunded to you.
To be eligible, the student must
- be in their first four years of higher education
- be pursuing a degree or recognized credential
- be enrolled at least half time for at least one academic term beginning in the tax year
- have received Form 1098-T, Tuition Statement, from an eligible educational institution
You cannot claim the AOTC unless you, your spouse (if filing jointly), and the qualifying student have a valid taxpayer ID number (SSN or ITIN).
Credit for Other Dependents (ODC)
Taxpayers who are not eligible to claim the Child Tax Credit may be able to claim the Credit for Other Dependents (ODC). This credit can be claimed in addition to the CDCTC. The maximum credit is $500 per qualifying dependent.
You can claim the ODC tax credit if
- You claim the person as a dependent on the taxpayer’s return.
- Cannot use the dependent to claim the child tax credit or additional child tax credit.
- The dependent is a U.S. citizen, national or resident alien.
The credit can be claimed for dependents of any age who have SSNs or ITINs.
Premium Tax Credit (PTC)
The Premium Tax Credit is a tax credit for eligible people who enroll, or whose family member enrolls, in a qualified health plan offered through a Marketplace. The PTC helps alleviate the cost of healthcare premiums by reducing the amount of tax you owe, giving you a refund, or increasing your refund amount.
To claim the PTC, your or a family member must have been enrolled in a qualified health plan for at least one month of the tax year.
Lifetime Learning Credit (LLC)
The Lifetime Learning Credit (LLC) is a non-refundable tax credit worth 20% of the first $10,000 of qualified education expenses, up to $2,000. The credit is for post-secondary education expenses, including undergraduate, graduate, and professional development courses.
To claim the credit, you (or your dependent) must have received Form 1098-T, Tuition Statement from a qualified institution. You cannot claim the credit if you or your spouse is a non-resident alien, unless you are treated as resident alien for tax purposes.
Note: You can claim both the LLC and AOTC credits on your tax return, but not for the same student or the same qualifying expenses.
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The articles and content published on this blog are provided for informational purposes only. The information presented is not intended to be, and should not be taken as, legal, financial, or professional advice. Readers are advised to seek appropriate professional guidance and conduct their own due diligence before making any decisions based on the information provided.
