The IRS is implementing changes to the Individual Tax Identification Numbers (ITINs) program required in last year’s Protecting Americans from Tax Hikes (PATH) Act. ITINs not used on a federal tax return in the most-recent three years will be deactivated as of Jan. 1, 2017, unless renewed. All other ITINs issued before 2013 will begin expiring on a multi-year basis. ITIN holders with the first set of expiring numbers (middle digits 78 and 79) may have already received a Letter 5821 with renewal instructions that should be completed with or before their next return. The renewal period for both unused and expiring ITINs begins Oct. 1, 2016. Procedures are available for single-family submissions if at least one family member has received a Letter 5821. Some tax credits such as the Child Tax Credit and the American Opportunity Credit may not be allowed if the ITIN is not renewed. ITIN renewal is not required to receive an information return such as a Form 1099. Be sure to always use the latest Form W-7.
There are also new requirements effective Oct. 1, 2016, for dependents whose passports do not have a U.S. entry date from countries other than Canada or Mexico or dependents of military stationed abroad. (IR-2016-100; Notice 2016-48)