$500 for what?!? Get your ITIN the cheap way (DIY)

Legalities first: I am in no way a lawyer, and this is in no way legal advice and I should not and cannot be held accountable for the information I provide in this blog post. You are responsible for ensuring the information you submit on a government form is accurate and true.

Phew!

Now, if you want to skip the beautifully written personal account of how and where I got this information, you can download the basic steps I followed here.

Now for the story.

As I'm going to be published by an American publisher, and I'm Canadian, I need to apply for an International Tax Identification Number, or an ITIN. To apply for an ITIN, I need to fill out a fairly straight forward one-page form and provide original proof of my citizenship and identity. My passport conveniently meets both of these requirements. I have four options for submitting my passport as proof.

1. Send it in the mail to Texas. (Not happening)
2. Apply in person at an IRS Tax Payer Assistance Center and have them verify my documents. (Sounds good)
3. Go to an "Acceptance Agent" in Canada and have them verify my documents.
4. Get a certified copy from the issuing authority (i.e. Passport Canada, i.e. lines)

I live super close to the border, so I originally planned to take a day off, drive across the 49th parallel, apply in person at one of their tax offices, and naturally, complete my day with a few hours of retail therapy. The problem? Apparently none of the offices in Washington state will process my proof of identity or proof of citizenship (i.e. my passport). They'll just take my passport and send it to the processing center in Texas. Wtf America?!? Well, that option flew out the window.

I didn't want to stand in line at Passport Canada, whose hours meant I'd have to take a day off, and while I was willing to do that for a day trip to the states, the lure of Surrey or Downtown Vancouver didn't hold the same retail excitement for me. So I logically turned to option three - Acceptance Agent. With my expert Google skills, I found three Acceptance Agents in the Lower Mainland of BC and asked them for quotes. I was willing to pay $50-100 for the convenience of a one-stop-shop, ease of mind and sheer laziness. Then I got the quotes back...

• $375
• $400 - plus I'd have to go to Passport Canada and get the certified copy myself
• $500

FOR A ONE PAGE FORM!!!! 

Wtf lawyers?!?

I think any other writer can back me up one this--I don't write for the money. A good thing, too, because I'm probably not going to make much. Certainly, not enough to justify forking out $500 for a one-page tax form. I'd rather spend some of that money on promotion.

So I stretched my fingers and went back to my internet searching skills and resigned myself to the DIY option.


THESE ARE THE STEPS I TOOK TO GET MY ITIN FOR MY AMERICAN ROYALTIES AS A CANADIAN AUTHOR.

Step 1) Hauled my ass to the nearest Passport Canada office. I needed my passport and Form PPTC 516. Certified copies of any passport are free until March 31, 2014, after which, they will cost $45. (If you have a passport that doesn't expire any time soon, I recommend getting lots of free copies while you can. They're good for the life of the passport.)

The Form PPTC 516 is a scanned copy, because for some reason, Passport Canada doesn't feel it's necessary to provide it online (wtf Canada?!?). You can pick one up in person as well. Time to process: 1 week if you pick-up, 2 weeks if you have it mailed back. They take your passport, so don't do this if you're expecting to cross any borders any time soon.

Step 2) I requested a letter from my American publisher stating that I needed an ITIN to collect royalties.

Step 3) Filled out the W-7 Form. The official form instructions are here. These are available off the the IRS website (www.irs.gov)

• Under reason, I selected option a) Non resident alien required to get ITIN to claim tax treaty benefit. (explained on page 3-4 of the Instructions)
• Under reason, I also selected h) Other. Beside "(see instructions)." Beside this, I wrote "exception 1d) Royalties Income." For Treaty Country, I wrote "Canada" and for treaty article number, I wrote "VII"
  
  "Other" is explained on page 4 of the W-7 Instructions.
  
  The exception is listed on page 7 of the W-7 Instructions.
  
  The Article number and Exemption information is explained on page 4 in Publication 901: U.S. Tax Treaties)
• I Filled out the rest of the form with my personal information and left the signing and dating blank

Step 4) When I received my certified copy of my passport, I signed and dated the W-7 and sent it, the certified copy of my passport, and the letter from my publisher to (on page 3 of the Instructions):

Internal Revenue Service
ITIN Operation
P.O. Box 149342
Austin, TX 78714-9342

Step 5) Waited

Step 6) Waited some more

Step 7) While I waited, I filled out the W-8BEN for my publisher. Official form instructions are here.

• Under part I, number 6, I left blank. (I recorded my ITIN here when I received it). I checked the ITIN box.
• Under part II, number 9, selected a and b. Under a, wrote "Canada" on the line.
• Under part II, number 10, it's article "VII", claimed a "0%" rate of withholding on: "Royalties Income." For the explanation, I wrote: "Business profits of self-employed individuals, such as royalties, are exempt from U.S. income tax"
  
  This information is explained on page 4 in Publication 901: U.S. Tax Treaties)
• Left the signing and dating blank

Step 8) When I received my ITIN, I poured myself a glass of wine and congratulated myself on saving $300-500. I completed my W-8BEN by recording my ITIN in section 6. Then I signed and dated it. I sent the W-8BEN to MY PUBLISHER, not the IRS.

Step 9) Finished my bottle of wine.

Wait, what?!?

For a simplified version of my steps, you can download the ITIN Recipe here. I call it the "ITIN Recipe." Enjoy.

I accept unopened boxes of chocolate and virtual hugs as a form of thanks :-)