The Child Tax Credit and Individual Taxpayer Identification Numbers (ITINs)

The Child Tax Credit and Individual Taxpayer Identification Numbers (ITINs)

INSIGHTi

The Child Tax Credit and Individual
Taxpayer Identification Numbers (ITINs)
December 16, 2021
With consideration of the Build Back Better Act (BBBA; H.R. 5376), congressional interest has focused
on whether children who do not have Social Security numbers (SSNs) should be eligible for the child tax
credit. In 2021, the credit has been temporarily expanded and is a near-universal benefit for all but the
highest-income families with children who file a federal income tax return.
Under current law, from 2018 through 2025, taxpayers who do not provide the SSN of an otherwise-
eligible child cannot receive a child credit for that child—including the expanded credit for 2021. Hence,
taxpayers cannot receive the child credit for children who have individual taxpayer identification numbers
(ITINs). The House-passed BBBA and the updated Senate Finance Committee text released December 11,
2021, would strike this temporary SSN requirement and allow taxpayers to claim the credit for otherwise
eligible children with any taxpayer identification (ID) number, including ITINs, beginning in 2022.
This Insight provides an overview of ITINs and the legislative history of the child tax credit’s ID
requirement.
Individual Taxpayer Identification Numbers
Individuals must provide a unique identifying number when they file tax returns with the Internal
Revenue Service (IRS). The general rule is that an individual’s taxpayer ID number is their SSN. SSNs
are issued by the Social Security Administration (SSA) to U.S. citizens and certain groups of
noncitizens—specifically, lawful permanent residents (green card holders), asylees, refugees, and other
noncitizens who are authorized to work in the United States. These SSNs are sometimes referred to as
“work-authorized SSNs.” SSA also issues SSNs to a small share of noncitizens without work
authorization who need an SSN to receive certain public benefits.
Taxpayers who are ineligible for SSNs are required to use ITINs when filing their tax returns with the
IRS. ITINs are issued by the IRS solely to enable noncitizens who do not have, and are ineligible for,
SSNs to comply with federal tax law.
ITIN use is often equated with immigration status, but use of an ITIN does not necessarily mean an
individual is unlawfully present. Past research has indicated that the IRS and the Treasury Inspector
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General for Tax Administration (TIGTA) believe, however, that a large proportion of ITIN filers are
unlawfully present noncitizens working in the United States.
Legislative History
The child tax credit was enacted in 1997 by the Taxpayer Relief Act (P.L. 105-34) and first went into
effect in 1998. Since enactment, taxpayers have been required to provide a taxpayer ID number for each
child for whom the credit is claimed and for themselves. At the time of enactment, the law did not specify
the type of taxpayer ID number that must be used during filing, thus allowing ITINs, SSNs, and adoption
taxpayer identification numbers (ATINs). (ATINs are temporarily assigned to children who are placed
with prospective adoptive parents.)
In 2009, the child tax credit was expanded to more low-income working families as part of the American
Recovery and Reinvestment Act of 2009 (P.L. 111-5). A 2011 TIGTA report subsequently found that the
amount of the credit claimed by low-income working families with ITINs increased from $2.1 billion for
returns processed in 2008 to $4.2 billion for returns processed in 2010. (About $1 billion of that amount
was due to a small share of ITIN filers claiming the credit for multiple years.) While some suggested that
a 1996 federal law might prohibit unlawfully present individuals from receiving the credit, the child tax
credit statute did not, during those years, expressly require any specific type of taxpayer ID number and
the IRS thus allowed individuals using ITINs to claim the credit.
Subsequently, various bills were introduced in the 112th through 114th Congresses to restrict taxpayers
with ITINs from claiming the credit, although none were enacted. Some of these bills also included an
SSN requirement for the child.
In 2015, P.L. 114-113 required that the taxpayer ID number—for both the qualifying child and the
taxpayer—had to be issued on or before the due date of the return. This provision prevents taxpayers who
receive a taxpayer ID number from amending older returns to receive the child credit in prior years.
In 2017, P.L. 115-97 temporarily required that, from 2018 through 2025, the taxpayer ID number for the
child be a work-authorized SSN. Hence, taxpayers who provide an ITIN or ATIN for their child cannot
receive the credit from 2018 to 2025. (The law did not change the ID requirement for the taxpayer.)
In 2021, the American Rescue Plan Act of 2021 (ARPA; P.L. 117-2) expanded the child tax credit for one
year, 2021, but did not change the SSN requirement established by P.L. 115-97.
BBBA proposes striking the temporary SSN requirement beginning in 2022. Since the SSN requirement
under current law is only in effect through 2025, this provision would effectively eliminate the SSN
requirement from 2022 to 2025.
Data on Children with ITINs
Most data on ITIN filers focuses on adult taxpayers. Less information is available on the number,
characteristics, and immigration status of children with ITINs. Pew estimated in 2016 that there were
approximately 675,000 immigrant children who would generally not be expected to be eligible for an
SSN. Nonetheless, it is unclear what share of noncitizen children presently in the United States actually
have ITINs. Further, it is unclear the number of children with ITINs who would otherwise be eligible for
the child tax credit. For example, in addition to any ID requirements, qualifying noncitizen children must
be residents of the United States. Additionally, the taxpayer claiming the child is only eligible for the fully
refundable child credit in 2021 (and the proposed extension in 2022 under BBBA) if they have lived in
the United States for at least half the year.

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Author Information

Margot L. Crandall-Hollick
Erika K. Lunder
Specialist in Public Finance
Section Research Manager

Disclaimer
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