Obtaining the IRS "ATIN" and Social Security Number
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A common question adoptive parents is whether they can claim their child as a dependent on their tax return when the adoption is still in progress and not finalized in a court of law. Adding to the complication is that the IRS Form 1040 and related tax forms request the child’s Social Security number, and most adoptees do not obtain a Social Security number until after the adoption is finalized.
Naming the child as a "dependent" on IRS forms
Adoptive parents can claim the child as a dependent as long as the child was lawfully placed in their care (e.g. by an agency, or following proper procedures in an independent adoption) when the adoption is domestic. Only one family may claim the dependent, however. Accordingly, if the child is a newborn, and never resided with anyone but the adoptive parent, there should be no conflict. However, if the child lived with another party, such as a birth parent, for part of the year, and the placement was made later, caution must be taken regarding who is taking the credit. If the child has spent most of the tax year at issue with the adoptive family, thus more time than with a prior family, normally the adoptive parents would be the taxpayer entitled to name the child as a dependent. For more information on these issues, you may obtain IRS Publications 501 (Exemptions, Standard Deductions and Filing Information) at http://www.irs.gov/pub/irs-pdf/p501.pdf and Publication 503 (Child and Dependent Care Expenses) http://www.irs.gov/pub/irs-pdf/p503.pdf, or by calling the IRS at 1-800-829-3676.
If it is an international adoption, the child may also be claimed as a dependent, the child must have a Permanent Resident Alien Card, or a Certificate of U.S. Citizenship, and have been lawfully placed into your custody.
Obtaining an ATIN
Let’s get back to the problem of identifying the adoptee on the tax forms when you do not yet have a Social Social number for him or her. What you request from the INS to use in the place of a Social Security number is an Adoption Taxpayer Identification Number (called an ATIN). Being assigned an ATIN is easy. You need to request a Form 7-WA (Application for Taxpayer Identification Number for Pending Adoptions). You can request on by calling the IRS at the number provided above, or download one at http://www.irs.gov/pub/irs-pdf/fw7a.pdf. Note, when the form requires you to submit certain documents, you are not required to submit originals. Copies are accepted, so don’t risk losing hard-to-replace documents.
The ATIN is valid for two years. Considering that most adoptions are finalized with approximately one year from birth or the commencement of the adoption, this is enough time. However, if your adoption takes longer, the ATIN can be extended upon your request. The IRS’s normal procedure is to send you a notice eighteen months after issuing the ATIN that it will be expiring in six months, to alert you to the possible need to renew it. The IRS notice explains how to extend the ATIN.
Obtaining a Social Security Number
Even when the adoption is finalized, there can be delays obtaining the child’s Social Security number. In previous years, it was common for adoptive parents to immediately go to their local Social Security Administration (SSA) office, and give them a certified copy of the court’s Order of Adoption (granting the adoption) and thus obtain the child’s newly issued Social Security number. Often the SSA office would ask to see accompanying documents, showing the child was born as one person, then legally becoming a person with another legal name (e.g. the birth mother names the child John David Jones, or if she selected no name, Baby Boy Jones, and this name is on the initial birth certificate), but when the adoption is granted the child takes the name selected by the adoptive family (e.g. Ryan Anthony Howard). The new, amended birth certificate (naming the adoptive parents as the biological parents, and naming the child as they elect) then takes the place of the initial birth certificate (the one naming the biological mother as the child’s mother), and the original birth certificate is sealed. The SSA office would often ask to see either the original birth certificate, or a similar document, showing the child’s lawful conversion from one name to another, and one parent to another, to avoid confusion and fraud.
Recently, however, some SSA offices are declining to issue the child a new Social Security number, even when being provided the Order of Adoption, until the adoptive parents have receivee the amended birth certificate. This may be no problem in states where the amended birth certificate is issued by the state of birth’s vital records office promptly (within a month), but some states take more than a year in issuing it.
Oddly, the SSA is often not consistent in their regional offices’ policies to issue a child a new Social Security number. Some offices will do so with simply the Order of Adoption, and a document showing the child’s prior identification, while other offices will tell you that they will not issue the Social Security number until you also can provide the new, amended birth certificate for the child. Some attorneys believe SSA offices are improperly requiring the amended birth certificate. If your local office refuses to issue your newly adopted child upon your providing the Order of Adoption, you may wish to print the following federal law authority, and present it to them, which implies that the SSA is not required to see an amended birth certificate in order to issue the new Social Security number. If you present the following legal authority, you might wish to demand they show you the specific law or SSA guideline which shows they are permitted to demand the amended birth certificate. Many adoptive parents have informed us that when they initially encountered a problem with the SSA office, when they presented the following authority, the SSA office dropped their refusal to issue the new Social Security number and did so immediately. (Please note that the SSA may have amended these regulations subsequent to our writing this article - but hopefully the excerpts below are still valid. You may wish to do your own Google search on the regulation, however.)
The applicable guidelines are found in the Social Security Administration’s procedural guidelines, the Programs Operations Manual System (POMS) section RM-00203-200E.4. (This section sets the minimum standards for verification of documents pursuant to The Intelligence Reform and Terrorism Prevention Act of 2004 (IRTPA), section 7213(a)(1)(B) of Public Law 108-458.)
POMS (Programs Operations Manual System) section RM-00203-200 “Evidence of Identity for an SSN Card
Subsection E.4 “U.S. Citizen: Birth through Age 5”
General summary: If “primary evidence” is available (U.S. state issued identity card or U.S. passport) it should be presented. However, if this primary evidence is not available, “secondary evidence” is identified as acceptable, specifically: “Final adoption decree issued by the court where the recent adoption occurred showing in addition to the child’s name, the child’s DOB, or the names of the adoptive parents’ names (if the adoption took place more than a year previously, there should be more current identity documents available (e.g. medical record).
Subsection E.5 “U.S. Citizen: Age 6 to 17” (The same section as above exists for older children.)