Volunteer Tax Return Preparation Guidelines For Completion of Tax Returns with an ITIN/SSN Mismatch
What is an ITIN/SSN Mismatch?
Individual Taxpayer Identification Number (ITIN) holders frequently file tax returns under their ITIN with attached Forms W-2 showing erroneous Social Security Numbers (SSNs). This creates an ITIN/SSN mismatch. A mismatch return causes the IRS' document-matching program to erroneously attribute the income and resulting tax to the SSN owner rather than the ITIN holder. This creates inaccuracies in both the SSN owner's tax account and Social Security Administration records.
When an individual comes to a volunteer tax preparation site with a W-2 reflecting a SSN requesting return preparation and produces an ITIN, the volunteer should encourage the taxpayer to request a corrected Form W-2 from their employer or former employer. If the taxpayer is unable to do so, the volunteer may prepare the tax return with the documents provided.
Reminder: Prior to completion of any tax return at a volunteer tax preparation site, the volunteer must request proof of identity. Two forms of identification are required. One must be photo identification such as
- National Identity Card
- Drivers License (U.S.)
- State Identification Card (U.S.)
- Military Identification Card
- School Photo ID
The second form of identification must be the original or a copy of the ITIN Card or Letter
One or both of the forms of identification should reflect the taxpayer's current mailing address. If the taxpayer cannot substantiate their identity, or if the volunteer is uncomfortable accepting the items presented as proof of identity, the taxpayer should seek professional assistance.
Returns prepared with an ITIN/SSN mismatch cannot be filed electronically. Do not change any information on the Form W-2. Volunteers may prepare a paper return for the taxpayer once identity has been verified.
- The return should reflect the ITIN for the taxpayer. The erroneous SSN on the Form W-2 should not be used on the return.
- A paper return must be filed. Publication 1345, Handbook for Authorized IRS e-file Providers of Individual Income Tax Returns, states that the information on a W-2 should never be altered. In order to e-file, the taxpayer identification number (TIN) on the W-2 must match the TIN on the federal return. Since the W-2 shows an SSN and the return shows an ITIN, these returns cannot be electronically field. As a precaution and reminder to the volunteers, if the volunteer is using electronic return preparation software (e.g. TaxWise), the ITIN/SSN mismatch should show up as an error and the program will not allow the return to be e-filed. Volunteers should NOT attempt to override this error. The return must be printed and given to the taxpayer to be mailed to the IRS.
- The taxpayer is not eligible for the Earned Income Tax Credit (EITC). Based on Chief Counsel Advice, dated May 15, 2001, if the taxpayer becomes a permanent resident of the United States and secures a valid SSN at a later date, he/she can file amended returns and claim EITC for all years for which the statue of limitations has not expired.
When an individual comes in to a volunteer tax preparation site and needs assistance with completion of Form W-7 volunteers should refer taxpayers to seek professional assistance unless a volunteer at that site has been specifically trained in completion of Form W-7 or an authorized acceptance agent is present to provide assistance.
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