Maybe you recently immigrated to the US and want to start a business. What’s weighing on your mind is that you don’t know how to proceed because you haven’t yet qualified for a social security number.
How can you pay taxes you owe when earning income in the US an immigrant?
There’s a legal way to solve this problem. You must file an ITIN application to obtain an IRS tax processing number.
You can also get small business loans with an ITIN, but only with certain lenders, like Camino Financial.
What is an ITIN?
ITIN stands for Individual Taxpayer Identification Number that the IRS created in 1996 providing a way for foreign nationals and others without a social security number to pay taxes they owed.
Even when you’re issued an ITIN, it doesn’t provide work authorization in the US or indicates that you’ve been granted legal immigration status. Neither does having an ITIN mean you have the same tax benefits as US citizens. But the number does provide other benefits so you can operate your business.
Here’s how a Latino entrepreneur moved forward with his business plans when he applied for an ITIN.
Samuel wanted to build a new future abroad
Before Samuel moved to the US, he wrote a business plan detailing every step to start a construction business. Having grown up in a family of builders, Samuel had the expertise and experience to build single-family homes.
What he hadn’t figured out was how to file a tax return and get a small business loan to fund startup costs. That’s until he contacted the Association of Latino Professionals for Amerca. The first step they recommended was to apply for an ITIN which he did immediately.
In the meantime, Samuel got a construction helper job with a local firm in his Latino community. Once he received the 9-digit number in about 6 weeks, Samuel registered his business, got a business license, and opened a business checking account.
By having an ITIN, he was able to apply for an unsecured business credit card, which didn’t require collateral like cash or a vehicle title. He was approved for a $300 credit limit and intended to use the card to make business purchases which he would pay off off each month to build a credit history.
Samuel’s goal was to continue to work part-time while he built his business.
After about 6 months, he intended to borrow about $5,000 to buy tools and start building homes in the US. By that time, lenders were able to check his business checking account activity, credit card history, and credit score.
Now Samuel is well on his way to building and having the capital to grow his business. His long-term goal is to hire employees and pass on his skills to others so they can one day start their own businesses.
When it’s time to file his tax return, Samuel can legally pay any tax he owes and stay compliant with state and federal tax laws. He knows that if he doesn’t file at least one tax return in five years, he will need to reapply for an ITIN.
Make your dreams come true too
Are you in a similar situation as Samuel?
As you can see, applying for an ITIN to use in place of a social security number helps you legally operate a business in the US. Equally important is being able to build a credit history to qualify for loans to grow your business.
Why not look check out how simple and easy it is to acquire an ITIN?
Don’t delay to take the next step to make your dreams become a reality.