97-30550. IRS Adoption Taxpayer Identification Numbers  

  • [Federal Register Volume 62, Number 226 (Monday, November 24, 1997)]
    [Rules and Regulations]
    [Pages 62518-62521]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 97-30550]
    
    
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    DEPARTMENT OF THE TREASURY
    
    Internal Revenue Service
    
    26 CFR Parts 301 and 602
    
    [TD 8739]
    RIN 1545-AV09
    
    
    IRS Adoption Taxpayer Identification Numbers
    
    AGENCY: Internal Revenue Service (IRS), Treasury.
    
    ACTION: Final and temporary regulations.
    
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    SUMMARY: This document contains final and temporary regulations under 
    section 6109 relating to taxpayer identifying numbers. The final 
    regulations include a cross reference to the temporary regulations, 
    which provide rules for obtaining and using IRS adoption taxpayer 
    identification numbers. The temporary regulations assist individuals 
    who are in the process of adopting children and wish to claim certain 
    tax benefits with respect to those children. The text of these 
    temporary regulations also serves as the text of the proposed 
    regulations set forth in the notice of proposed rulemaking on this 
    subject in
    
    [[Page 62519]]
    
    the Proposed Rules section of this issue of the Federal Register.
    
    DATES: These regulations are effective November 24, 1997.
    
    FOR FURTHER INFORMATION CONTACT: Michael L. Gompertz, (202) 622-4910 
    (not a toll-free number).
    
    SUPPLEMENTARY INFORMATION:
    
    Paperwork Reduction Act
    
        These final and temporary regulations are being issued without 
    prior notice and public procedure pursuant to the Administrative 
    Procedure Act (5 U.S.C. 553). For this reason, the collection of 
    information contained in these regulations has been reviewed and, 
    pending receipt and evaluation of public comments, approved by the 
    Office of Management and Budget under control number 1545-1564. 
    Responses to this collection of information are required to obtain a 
    taxpayer identification number.
        For further information concerning this collection of information, 
    and where to submit comments on the collection of information and the 
    accuracy of the estimated burden, and suggestions for reducing this 
    burden, please refer to the preamble to the cross-referencing notice of 
    proposed rulemaking published in the Proposed Rules section of this 
    issue of the Federal Register.
        An agency may not conduct or sponsor, and a person is not required 
    to respond to, a collection of information unless the collection of 
    information displays a valid control number.
        Books or records relating to this collection of information must be 
    retained as long as their contents may become material in the 
    administration of any internal revenue law. Generally, tax returns and 
    tax return information are confidential, as required by 26 U.S.C. 6103.
    
    Background
    
        This document contains amendments to the Regulations on Procedure 
    and Administration (26 CFR part 301) relating to identifying numbers 
    under section 6109. Section 6109(a)(1) provides that any person 
    required to make a return, statement, or other document must include in 
    the document such identifying number as may be prescribed for securing 
    proper identification of the person. Section 6109(a)(2) provides that 
    any person with respect to whom a return, statement, or other document 
    is required to be made by another person or whose identifying number 
    must be shown on a return of another person, must furnish to the other 
    person such identifying number as may be prescribed for securing the 
    person's proper identification. Section 6109(d) provides that an 
    individual must use a social security number as the individual's 
    taxpayer identification number unless the Secretary prescribes 
    otherwise by regulations.
        Currently, there are three types of taxpayer identification numbers 
    (TINs) assigned to individuals: (1) a social security number (SSN), (2) 
    an IRS individual taxpayer identification number (ITIN) assigned to an 
    alien individual who is ineligible to obtain an SSN, and (3) an 
    employer identification number (EIN) assigned to an individual who is 
    engaged in a trade or business as a sole proprietor. An SSN is assigned 
    by the Social Security Administration. An ITIN or an EIN is assigned by 
    the IRS.
        Section 1615 of the Small Business Job Protection Act of 1996 
    (Public Law 104-188, 110 Stat. 1755, 1853 (1996)) added sections 
    21(e)(10) and 151(e) to deny the dependent care credit and the 
    deduction for the dependency exemption if the TIN (as defined by 
    section 6109 and the regulations thereunder) of the dependent is not 
    included on the return claiming the credit or deduction. Sections 
    21(e)(10) and 151(e) generally are effective for tax returns due 
    (without regard to extensions) after September 18, 1996.
        In addition, section 101 of the Taxpayer Relief Act of 1997 (Pub. 
    L. 105-34, 111 Stat. 788, 796 (1997)) added section 24 to the Code to 
    provide a child tax credit for each qualifying child, effective for 
    taxable years beginning after December 31, 1997. Pursuant to section 
    24(e), the taxpayer will be denied the credit if the qualifying child's 
    TIN is not included on the return claiming the credit.
        In most cases, taxpayers can meet the TIN requirements of sections 
    21, 24, and 151 by including a child's SSN on the return claiming the 
    credit or deduction. In the case of adoption, however, a child may not 
    have an SSN or, if the child does have an SSN, the taxpayer adopting 
    the child (the prospective adoptive parent) may be unable to obtain the 
    SSN because of confidentiality laws. See H.R. Rep. No. 542, 104th 
    Cong., 2d Sess. 20 (1996); S. Rep. No. 412, 103d Cong., 2d Sess. 163 
    (1994).
    
    Explanation of Provisions
    
        These temporary regulations authorize the IRS to assign a new form 
    of taxpayer identification number, the IRS adoption taxpayer 
    identification number (ATIN), to a child who is in the process of being 
    adopted (a prospective adoptive child). The regulations are effective 
    for income tax returns due (without regard to extension) on or after 
    April 15, 1998.
        The temporary regulations provide that an ATIN is a temporary 
    taxpayer identification number that expires two years after the date of 
    issuance. However, upon application, the IRS may grant an extension of 
    the ATIN. A prospective adoptive parent may apply for an ATIN for a 
    child if: (1) The prospective adoptive parent is eligible to claim a 
    personal exemption under section 151 with respect to the child; (2) the 
    child is placed with the prospective adoptive parent for legal adoption 
    by an authorized placement agency (as defined in Sec. 1.152-2(c)); (3) 
    the Social Security Administration will not assign the prospective 
    adoptive parent an SSN for the child (for example, because the adoption 
    is not final); and (4) the prospective adoptive parent has used all 
    reasonable means to obtain the child's assigned SSN, if any, but has 
    been unsuccessful in obtaining this number (for example, because the 
    birth parent who obtained the number is not legally required to 
    disclose the number to the prospective adoptive parent).
        The temporary regulations provide that an application for an ATIN 
    must be made on the Form W-7A, Application for Taxpayer Identification 
    Number for Pending Adoptions, or such other form prescribed by the IRS. 
    The ATIN application must be accompanied by documentary evidence to 
    establish that an authorized placement agency placed the child in the 
    prospective adoptive parent's household for legal adoption by the 
    parent. Such documentary evidence may include: a copy of a placement 
    agreement entered into between the prospective adoptive parent and an 
    authorized placement agency; an affidavit signed by the adoption 
    attorney or government official who placed the child for legal adoption 
    pursuant to state law; a document authorizing the release of a newborn 
    child from a hospital to a prospective adoptive parent for adoption; or 
    a court document ordering or approving the placement of a child for 
    adoption.
        When an adoption becomes final, the adoptive parent must apply for 
    an SSN for the child. Once obtained, the SSN, rather than the ATIN, 
    must be used as the child's TIN on all future returns, statements, or 
    other documents required by the Code.
        An ATIN may be used by the prospective adoptive parents to meet the 
    TIN requirements of sections 21(e)(10), 24(e), and 151(e), relating to 
    the dependent care credit, the child tax credit, and the dependency 
    exemption, respectively. Also, as may be prescribed by forms, 
    instructions, or otherwise, an
    
    [[Page 62520]]
    
    ATIN may be used to meet the TIN requirements under sections 23(f) and 
    137(e), relating to qualified adoption expenses. The ATIN may not be 
    used to meet the TIN requirement of section 32. See section 32(l).
        The ATIN procedures do not apply to adoptions involving alien 
    children. Generally, the Social Security Administration will assign an 
    SSN to an alien child if all the requirements for assigning a number 
    are met. When the Social Security Administration cannot assign an SSN, 
    the child generally will be eligible for an ITIN.
        In addition to adoptions involving alien children, there are two 
    other types of adoptions to which the ATIN procedures may not apply. If 
    the child placed for adoption is a foster child or is otherwise in the 
    custody of a government agency or court (because, for example, the 
    birth parents' rights were previously terminated for abuse or neglect), 
    the government agency or court will generally obtain an SSN for the 
    child and can make the SSN available to the prospective adoptive 
    parent. Also, the prospective adoptive parent may be able to obtain the 
    child's SSN from the birth parents (or other person) in the case of an 
    adoption by the child's relatives or an adoption in which the adoptive 
    parent and birth parent share information about the child and 
    themselves.
        Taxpayers are invited to comment on two issues partially addressed 
    by the temporary regulations. First, comments are requested regarding 
    what types of documents are available to establish that a child has 
    been placed in the prospective adoptive parent's household for legal 
    adoption. Also, comments are requested as to whether certain types of 
    adoptions (in addition to foreign adoptions) should be completely 
    excluded from the ATIN process. In particular, comments are requested 
    regarding whether a prospective adoptive parent is always able to 
    obtain a prospective adoptive child's SSN if the child is a foster 
    child or is otherwise in the custody of a government agency or court.
    
    Special Analyses
    
        It has been determined that this Treasury decision is not a 
    significant regulatory action as defined in EO 12866. Therefore, a 
    regulatory assessment is not required. It also has been determined that 
    section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) 
    does not apply to these regulations, and because the regulation does 
    not impose a collection of information on small entities, the 
    Regulatory Flexibility Act (5 U.S.C. chapter 6) does not apply. Only 
    individuals may receive ATINs under this Treasury decision, and an 
    individual is not a small entity as defined in the Regulatory 
    Flexibility Act. See 5 U.S.C. 601(6).
        Pursuant to section 7805(f) of the Internal Revenue Code, these 
    regulations will be submitted to the Chief Counsel for Advocacy of the 
    Small Business Administration for comment on their impact on small 
    business.
    
    Drafting Information
    
        The principal author of these regulations is Michael L. Gompertz of 
    the Office of Assistant Chief Counsel (Income Tax and Accounting). 
    However, other personnel from the IRS and Treasury Department 
    participated in their development.
    
    List of Subjects
    
    26 CFR Part 301
    
        Employment taxes, Estate taxes, Excise taxes, Gift taxes, Income 
    taxes, Penalties, Reporting and recordkeeping requirements.
    
    26 CFR Part 602
    
        Reporting and recordkeeping requirements.
    
    Adoption of Amendments to the Regulations
    
        Accordingly, 26 CFR parts 301 and 602 are amended as follows:
    
    PART 301--PROCEDURE AND ADMINISTRATION
    
        Paragraph 1. The authority citation for part 301 is amended by 
    adding entries in numerical order to read as follows:
    
        Authority: 26 U.S.C. 7805 * * *
        Section 301.6109-1T also issued under 26 U.S.C. 6109;
        Section 301.6109-3T also issued under 26 U.S.C. 6109; * * *
    
        Par. 2. Section 301.6109-1 is amended by adding paragraph 
    (h)(2)(iii) to read as follows:
    
    
    Sec. 301.6109-1  Identifying numbers.
    
    * * * * *
        (h) * * *
        (2) * * *
        (iii) Paragraphs (a)(1)(i), (a)(1)(ii)(A), and (a)(1)(ii)(B) of 
    this section do not apply after November 24, 1997. For further guidance 
    after November 24, 1997, see Sec. 301.6109-1T(a)(1)(i), (a)(1)(ii) 
    introductory text, and (a)(1)(ii)(A) and (B).
        Par. 3. Section 301.6109-1T is added to read as follows:
    
    
    Sec. 301.6109-1T  Identifying numbers (temporary).
    
        (a) In general--(1) Taxpayer identifying numbers--(i) Principal 
    types. There are four principal types of taxpayer identifying numbers: 
    social security numbers, Internal Revenue Service (IRS) individual 
    taxpayer identification numbers, employer identification numbers, and 
    IRS adoption taxpayer identification numbers. Social security numbers 
    take the form 000-00-0000. IRS individual taxpayer identification 
    numbers and IRS adoption taxpayer identification numbers also take the 
    form 000-00-0000 but include a specific number or specific numbers 
    designated by the IRS. Employer identification numbers take the form 
    00-0000000.
        (ii) Uses. Social security numbers, IRS individual taxpayer 
    identification numbers, and IRS adoption taxpayer identification 
    numbers are used to identify individual persons. For the definition of 
    social security number and employer identification number, see 
    Secs. 301.7701-11 and 301.7701-12, respectively. For the definition of 
    IRS individual taxpayer identification number, see Sec. 301.6109-
    1(d)(3). For the definition of IRS adoption taxpayer identification 
    number, see Sec. 301.6109-3T. Except as otherwise provided in 
    applicable regulations under this title or on a return, statement, or 
    other document, and related instructions, taxpayer identifying numbers 
    must be used as follows--
        (A) Except as otherwise provided in Sec. 301.6109-1(a)(1)(ii)(D), 
    paragraph (a)(1)(ii)(B) of this section, and Sec. 301.6109-3T, an 
    individual required to furnish a taxpayer identifying number must use a 
    social security number.
        (B) Except as otherwise provided in Sec. 301.6109-1(a)(1)(ii)(D) 
    and Sec. 301.6109-3T, an individual required to furnish a taxpayer 
    identifying number but who is not eligible to obtain a social security 
    number must use an IRS individual taxpayer identification number.
        (a)(1)(ii)(C) through (g) [Reserved]. For further guidance, see 
    Sec. 301.6109-1(a)(1)(ii)(C) through (g).
        (h) Effective date. Paragraphs (a)(1)(i), (a)(1)(ii) introductory 
    text, (a)(1)(ii)(A), and (a)(1)(ii)(B) of this section are applicable 
    after November 24, 1997. For further guidance prior to November 24, 
    1997, see Sec. 301.6109-1(a)(1)(i), (a)(1)(ii)(A) and (a)(1)(ii)(B).
        Par. 4. Section 301.6109-3T is added to read as follows:
    
    [[Page 62521]]
    
    Sec. 301.6109-3T  IRS adoption taxpayer identification numbers 
    (temporary).
    
        (a) In general--(1) Definition. An IRS adoption taxpayer 
    identification number (ATIN) is a temporary taxpayer identifying number 
    assigned by the Internal Revenue Service (IRS) to a child (other than 
    an alien individual as defined in Sec. 301.6109-1(d)(3)(i)) who has 
    been placed, by an authorized placement agency, in the household of a 
    prospective adoptive parent for legal adoption. An ATIN is assigned to 
    the child upon application for use in connection with filing 
    requirements under this title. When an adoption becomes final, the 
    adoptive parent must apply for a social security number for the child. 
    After the social security number is assigned, that number, rather than 
    the ATIN, must be used as the child's taxpayer identification number on 
    all returns, statements, or other documents required under this title.
        (2) Expiration and extension. An ATIN automatically expires two 
    years after the number is assigned. However, upon request, the IRS may 
    grant an extension if the IRS determines the extension is warranted.
        (b) Definitions. The following definitions apply for purposes of 
    this section--
        (1) Authorized placement agency has the same meaning as in 
    Sec. 1.152-2(c) of this chapter;
        (2) Prospective adoptive child or child refers to a child who has 
    not been adopted, but who has been placed in the household of a 
    prospective adoptive parent for legal adoption by an authorized 
    placement agency; and
        (3) Prospective adoptive parent or parent refers to an individual 
    in whose household a prospective adoptive child is placed by an 
    authorized placement agency for legal adoption.
        (c) General rule for obtaining a number--(1) Who may apply. A 
    prospective adoptive parent may apply for an ATIN for a child if--
        (i) The prospective adoptive parent is eligible to claim a personal 
    exemption under section 151 with respect to the child;
        (ii) An authorized placement agency places the child with the 
    prospective adoptive parent for legal adoption;
        (iii) The Social Security Administration will not process an 
    application for an SSN by the prospective adoptive parent on behalf of 
    the child (for example, because the adoption is not final); and
        (iv) The prospective adoptive parent has used all reasonable means 
    to obtain the child's assigned social security number, if any, but has 
    been unsuccessful in obtaining this number (for example, because the 
    birth parent who obtained the number is not legally required to 
    disclose the number to the prospective adoptive parent).
        (2) Procedure for obtaining an ATIN. If the requirements of 
    paragraph (c)(1) of this section are satisfied, the prospective 
    adoptive parent may apply for an ATIN for a child on Form W-7A, 
    Application for Taxpayer Identification Number for Pending Adoptions 
    (or such other form as may be prescribed by the IRS). An application 
    for an ATIN should be made far enough in advance of the first intended 
    use of the ATIN to permit issuance of the ATIN in time for such use. An 
    application for an ATIN must include the information required by the 
    form and accompanying instructions, including the name and address of 
    each prospective adoptive parent and the child's name and date of 
    birth. In addition, the application must include such documentary 
    evidence as the IRS may prescribe to establish that a child was placed 
    in the prospective adoptive parent's household by an authorized 
    placement agency for legal adoption. Examples of acceptable documentary 
    evidence establishing placement for legal adoption by an authorized 
    placement agency may include--
        (i) A copy of a placement agreement entered into between the 
    prospective adoptive parent and an authorized placement agency;
        (ii) An affidavit signed by the adoption attorney or government 
    official who placed the child for legal adoption pursuant to state law;
        (iii) A document authorizing the release of a newborn child from a 
    hospital to a prospective adoptive parent for adoption; and
        (iv) A court document ordering or approving the placement of a 
    child for adoption.
        (d) Effective date. The provisions of this section apply to income 
    tax returns due (without regard to extension) on or after April 15, 
    1998.
    
    PART 602--OMB CONTROL NUMBERS UNDER THE PAPERWORK REDUCTION ACT
    
        Par. 5. The authority citation for part 602 continues to read as 
    follows:
    
        Authority: 26 U.S.C. 7805.
    
        Par. 6. Section 602.101(c) is amended by adding an entry in 
    numerical order to the table to read as follows:
    
    
    Sec. 602.101  OMB Control numbers.
    
    * * * * *
        (c) * * *
    
    ------------------------------------------------------------------------
                                                                 Current OMB
         CFR part or section where identified and described      control No.
    ------------------------------------------------------------------------
                      *        *        *        *        *                 
    301.6109-3T................................................    1545-1564
                      *        *        *        *        *                 
    ------------------------------------------------------------------------
    
    Michael P. Dolan,
    Acting Commissioner of Internal Revenue.
        Approved: October 24, 1997.
    Donald C. Lubick,
    Acting Assistant Secretary of the Treasury.
    [FR Doc. 97-30550 Filed 11-21-97; 8:45 am]
    BILLING CODE 4830-01-P
    
    
    

Document Information

Effective Date:
11/24/1997
Published:
11/24/1997
Department:
Internal Revenue Service
Entry Type:
Rule
Action:
Final and temporary regulations.
Document Number:
97-30550
Dates:
These regulations are effective November 24, 1997.
Pages:
62518-62521 (4 pages)
Docket Numbers:
TD 8739
RINs:
1545-AV09: Taxpayer Identification Numbers (TINs) for Adopted Children
RIN Links:
https://www.federalregister.gov/regulations/1545-AV09/taxpayer-identification-numbers-tins-for-adopted-children
PDF File:
97-30550.pdf
CFR: (6)
26 CFR 1.152-2(c)
26 CFR 301.6109-1(a)(1)(ii)(C)
26 CFR 602.101
26 CFR 301.6109-1
26 CFR 301.6109-1T
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