Non-resident aliens often confuse ITIN, EIN, and SSN. This guide explains their definitions, purposes, eligibility, and core differences, helping you understand when to apply for an ITIN or EIN, why non-residents typically can’t get an SSN, and how to ensure tax compliance and smooth business operations.
For non-resident aliens planning to start a business, invest, or generate income in the United States, ITIN, EIN, and SSN are three terms you’ll frequently encounter—yet they are often misunderstood and confused. Each serves a distinct purpose, has specific eligibility requirements, and carries different legal implications.
Mistaking one for another can lead to incorrect tax filings, bank account application rejections, or even IRS scrutiny.
This guide will clearly explain the core differences between ITIN, EIN, and SSN, clarify when non-resident aliens need each one, and explain why SSN is typically irrelevant to you.
1. SSN (Social Security Number): Who Needs It? Can Non-Residents Apply?
The SSN (Social Security Number) is a nine-digit number issued by the Social Security Administration (SSA).
- Primary Uses:
- Tracking an individual’s earnings and work history in the U.S.
- Qualifying for Social Security benefits (e.g., retirement, disability).
- Required for employment in the U.S.
- Sometimes used for credit checks, phone contracts, etc.
- Who Can Apply? The SSN is primarily for:
- U.S. citizens
- U.S. permanent residents (green card holders)
- Foreign nationals holding immigration or non-immigrant visas that authorize work in the U.S. (e.g., H-1B, L-1, F-1 students on OPT)
Key Point for Non-Resident Aliens: If you do not have authorization to work in the U.S., you are generally not eligible to apply for an SSN. Most non-resident aliens (e.g., those on B1/B2 visitor visas, or registering an LLC for passive investment) cannot and should not apply for an SSN. Attempting to obtain an SSN through improper channels is a serious violation of U.S. law.
2. ITIN (Individual Taxpayer Identification Number): The Non-Resident’s Personal Tax ID
The ITIN (Individual Taxpayer Identification Number) is a tax processing number issued by the Internal Revenue Service (IRS) to individuals who are required to have a U.S. taxpayer identification number but do not have, and are not eligible to obtain, an SSN.
- Primary Uses:
- Filing federal income tax returns (e.g., Form 1040-NR) with the IRS.
- Reporting U.S.-source income (such as dividends, interest, royalties, or rental income from U.S. real estate) when the individual has a tax obligation.
- Used in tax information exchange with countries that have tax treaties with the U.S.
- Who Can Apply? Individuals who need to file a U.S. tax return but are not eligible for an SSN, including:
- Non-resident aliens (NRA)
- Foreign spouses (if filing jointly with a U.S. citizen/resident)
- Certain foreign children
- How to Apply? By submitting IRS Form W-7. This typically requires certified copies of identity documents (such as a passport).
Key Point for Non-Resident Aliens: The ITIN is a personal number used for individual tax reporting. If you, as an individual, receive income from U.S. sources, you likely need an ITIN. However, it cannot be used for work authorization or Social Security benefits.
3. EIN (Employer Identification Number): The Business “Tax ID”
The EIN (Employer Identification Number), also known as a Federal Tax ID Number, is a unique nine-digit number assigned by the IRS to business entities for tax filing and reporting purposes.
- Primary Uses:
- Filing business tax returns (for corporations, LLCs, partnerships, etc.).
- Opening a business bank account in the U.S.
- Applying for business licenses and permits.
- Hiring employees and reporting wages.
- Establishing business credit.
- Who Can Apply?Any business entity operating in or planning to operate in the U.S., regardless of the owner’s residency status.
- U.S. corporations
- Limited Liability Companies (LLCs)
- Partnerships
- Trusts, estates, etc.
Key Point for Non-Resident Aliens: Even if you are a foreign citizen who has never set foot in the U.S., if you have registered an LLC or other business entity in the U.S., you must obtain an EIN. The EIN is your business’s “ID card” within the U.S. tax and financial system.
4. Core Differences Summary: A Quick Reference Table
| Feature | SSN (Social Security Number) | ITIN (Individual Taxpayer Identification Number) | EIN (Employer Identification Number) |
|---|---|---|---|
| Issuing Agency | Social Security Administration (SSA) | Internal Revenue Service (IRS) | Internal Revenue Service (IRS) |
| Applicable To | Individuals | Individuals | Business Entities |
| Primary Purpose | Employment, Social Security, personal taxes | Personal tax reporting | Business taxes, bank accounts, hiring employees |
| Can Non-Resident Aliens Apply? | Generally No (requires work authorization) | Yes (when they have a U.S. tax obligation) | Yes (when they own a U.S. business) |
| Can Be Used for Employment? | Yes | No | No (used by the business) |
| Can Be Used to Open a Business Bank Account? | Possibly (for personal accounts), but business accounts usually require an EIN | Typically No | Yes (required) |
5. When Do Non-Resident Aliens Need Which One?
- Do I need an SSN? Almost never. Unless you hold a visa that allows you to work in the U.S., you cannot apply for an SSN. Do not attempt to apply for an SSN just to open a bank account or register a company.
- Do I need an ITIN?Yes, when you, as an individual, have U.S.-source income. For example:
- You receive dividends or interest directly from a U.S. company.
- You own U.S. real estate and collect rental income.
- You are a director or consultant for a U.S. company and receive compensation.
- You file a joint tax return with a U.S. citizen/resident spouse.
- Do I need an EIN?Absolutely yes, when you own or plan to own a business entity in the U.S. For example:
- You have registered a U.S. LLC.
- You have formed a U.S. corporation (Corp).
- You need to open a bank account for your U.S. business.
- Your LLC plans to generate income or hire employees in the U.S.
Important Note: An LLC owned by a non-resident alien may have reporting and withholding obligations (e.g., under sections 1445, 1446) on behalf of its owner, depending on the type of income.
6. Conclusion: Know Your Role and Needs
- You are an individual with U.S. income? → You likely need an ITIN.
- You own a U.S. company or LLC? → Your business must have an EIN.
- You want to work in the U.S.? → You need a work visa, after which you may be eligible for an SSN.
Remember: ITINs and EINs are alternatives provided by the IRS for individuals and entities that cannot obtain an SSN. For the vast majority of non-resident alien entrepreneurs, the EIN is the starting point and a necessity for conducting business in the U.S., while the ITIN is only needed when personal taxable income is involved.
By correctly understanding and applying for these numbers, you can ensure your U.S. business and investment activities are legal and compliant. If you’re unsure about the application process, using a professional service like SpeedEIN can help you apply for your EIN accurately and efficiently, avoiding delays or rejections due to errors.