Taxpayer Identification Numbers
Treasury regulations require that you obtain the taxpayer identification number (TIN) of any person who opens an account with you or purchases a certificate of deposit from you. [31 CFR 1020.410(b)] The TIN for an individual is a social security number. For all other entities, the TIN is an employer identification number. (The Social Security Administration generally limits its assignment of social security numbers to individuals who are U.S. citizens and alien individuals legally admitted to the United States for permanent residence or under other immigration categories that authorize U.S. employment. A nonresident alien may, however, be able to obtain an “individual taxpayer identification number”—or “ITIN”—by submitting to the IRS a Form W-7. See 26 CFR 301.6109-1.)
Treasury regulations require that you obtain the TIN within 30 days of when the account is opened or the CD is purchased. If the account or CD is in the names of more than one person, you must obtain the TIN of any one of the persons who has a financial interest in the account or CD. Occasionally, you may not be able to obtain the depositor’s TIN within the 30-day time period. You can avoid liability under these regulations with respect to those depositors if you: (1) make a reasonable effort to obtain the TIN; and (2) maintain a list showing the names, addresses, and account numbers of those depositors who have not supplied you with a TIN. You also must make this list available to the Secretary of the Treasury upon request.
The 30-day period is extended if the depositor has applied for a TIN on Form SS-4 or SS-5 until the person has had a reasonable opportunity to secure the TIN and furnish it to you. [31 CFR 1020.410(b)]
If the depositor is a nonresident alien, you are required to record the person’s passport number or a description of some other government document used to verify his or her identity. [31 CFR 1020.410(b)]
- Agencies or instrumentalities of federal, state, local, or foreign governments;
- Judges, public officials, or clerks of courts of record as custodians of funds in controversy or under the control of the courts;
- Aliens who are: (1) Ambassadors, ministers, career diplomatic or consular officers; or (2) Naval, military, or other attaches of foreign embassies and legations and the members of their immediate families;
- Aliens who are accredited representatives of international organizations which are entitled to enjoy privileges, exemptions, and immunities as an international organization under the International Organization Immunities Act of 1945 and members of their immediate families;
- Aliens temporarily residing in the United States for a period not to exceed 180 days; • Aliens not engaged in a trade or business in the U.S. who are attending a recognized college or university or any training program supervised or conducted by any agency of the federal government;
- Unincorporated subordinate units of a tax-exempt central organization which are covered by a group exemption letter;
- A person under 18 years of age with respect to an account opened as a part of a school thrift savings program, provided the annual interest is less than $10;
- A person opening a Christmas club, vacation club, and similar installment savings program, provided the annual interest is less than $10; and • Nonresident aliens who are not engaged in a trade or business in the U.S.
Although the requirements for obtaining a depositor’s TIN under these Treasury regulations are similar to the requirements of “due diligence” under the backup withholding regulations, they are not identical. Complying with these regulations will not always constitute due diligence for backup withholding purposes. See the chapters in this manual dealing with backup withholding for more information on what constitutes due diligence. Also see those chapters for information about the change in backup withholding from the “due diligence” standard to the “reasonable cause” standard.