What is Social Security Number and Why Do You Need It?

A social Security number (SSN) is number that the United States government gives out to citizens who apply for it. It has nine digits and is instantly recognizable for any US citizen. As a rule, this number is used for monitoring the citizen’s earnings and length of employment. The necessity of this information comes through when the individual is retiring or needs a Social disability income.

By using your private information, the government calculates your benefit payments.

The SSN is basically a lifetime number! However, there are some cases when it gets stolen or lost; obviously, you’d need a replacement if this happens.

Why Do You Need a Social Security Number?

Whenever you get a new job, you will be asked for a Social Security number. This number will be used for reporting your income information to the IRS and reporting your Social Security salary to the Social Security Administration. Additionally, the SSN is used for state income tax reporting.

Here are the most common instances when you will need a Social Security number:

 

• If you decide to open an Account with United States Financial Institutions: All the United States banks are required to obtain consumers SSN in order to check your credit history and your personal tax information.

 

• Applying for a Federal Loan: By using your SSN, the government checks your ability when you are applying for a federal loan.

 

• Applying for Some Types of Public Assistance: This includes unemployment benefits or Social Security disability Income.

 

• Enrolling in Medicare: The Social Security Administration works with Medicare and Medicaid organizations by enrolling citizens in Medicare.

 

• Applying for a Passport: When getting a U.S. passport, Federal Law will require an SSN.

 

• For Tax Returns:  This number is used by the IRS to check the matching of your income tax return to the one that your employer reported for you.

 

• Obtaining a Driver’s License: You should provide your SSN when applying for your driver’s license.

When launching the Social Security number in 1936, the government probably did not think that this document would be so crucial in the process of checking citizens. Nowadays, it is widely used for all the purposes since it is the easiest way for most businesses to identify individuals.

If you’re planning on creating an ecommerce business in the U.S., your SSN will definitely come in handy! But, what if you’re not a U.S. citizen?  In that case, you would need to get an ITIN! We have dedicated blogs on this, as Prestige Auditors can help you acquire an ITIN easily, as well as offering other ecommerce business solutions. Contact us now for more information!