What activities might require you to provide your social security number?

A. Starting a new job.

B. Boarding an airplane.

C. Buying something with a credit card.

D. Renting a car.

The answer is A: Starting a new job may require you to provide your social security number to conduct your credit or employment background check.

What is a social security number?

In the USA, the Social Security Number or SSN is a number issued to permanent residents, citizens and temporary resident workers. It is a 9 digit number that is issued to individuals by SSA (Social Security Administration) for purposes of Social Security and national identification for taxation.

The original purpose of the Social Security Number was to track the individual accounts within the Social Security programs. But now it is also used as a national identifier in the USA. Patient, student, employee records and credits scores are indexed by social security number most times.

The IRS uses this for tracking tax payments, and it also allows parents to claim their children as dependents for taxation. There are three kinds of SSN cards issued:

  • Cards issued to US permanent residents and US Citizens
  • One ”not valid for employment” which cannot be used as authorization for proof of work.
  • The last type of SSN is “valid for work, only with INS/DHS authorization”. These cards are for those who have temporary work authorization in the United States and satisfy the I-9 requirement if accompanied by the work authorization card.

Purpose of having social security number

A Social Security Number or SSN is a critical document that one needs if you are living or working in the United States. The government can use this number to track a person’s lifetime earnings and the number of years they have worked or spent in employment.

When a person retires, or he needs to receive a social security disability income, then the government can use the SSN to get the information about the worker’s contributions to social security. This is then used to make calculations for the worker’s eligibility and payment of benefit.

When do tou need social security number?

If you get a job in the United States, the employer will ask for your social security number. The accounting department of the employer will use it to report your income tax to the IRS – Internal Revenue Service as well as the Social Security Administration, to report the employee’s social security wages.

They will use it for state income tax purposes as well. The following are more scenarios where you need an SSN:

Application for a federal loan

The government uses the social security number to determine if you are eligible when applying for a federal loan, like a federal student loan.

So, if you need a federal student loan, then you cannot be in default of another federal loan. You also must have an eligible visitor status or citizenship. Most male applicants should have registered with selective service.

To open an account with a U.S. financial institution

The federal government of the United States requires banks to obtain a customer’s social security number. A financial institute can use the SSN to check credit scores, report the interest, and investment losses or income to IRS.

The same number can be used for reporting the tax-deductible mortgage interest to IRS and manage your account. Alternatively, financial institutions can accept the taxpayer identification number or Employer Identification Number, which you can apply for through the IRS.

Application for public assistance

You can use the SSN to apply for certain kinds of public assistance. Unemployment benefits or social security disability income are public assistance programs managed by the state or federal government agencies.

These agencies use a social security number to identify persons to ensure that they shall not be getting benefits that they aren’t entitled to.

Passport application

There is a requirement under federal law, that mandates submission of a social security number if you have one when applying for a United States passport. If you make an application without an SSN, then there will be delays in processing the application.

If you have a social security number, but don’t add it to a passport application, then you can also be fined an amount of $500.

Medicare enrollment

The Social Security Administration works along with Medicaid Services and Medicare Centers to enrol people in the Medicare program.

Tax return

SSN is required when you file a tax return. The Internal Revue Service can use the social security number to match your reported income to your tax return and to the income that financial institutions and your employer report having paid to you.

A social security number is also used to claim tax deductions if you claim your child as a dependent.

Driving license

While getting a driving license, one needs to provide an SSN, if they have it.

For non-citizens, the case is slightly different, and they are exempt from providing an SSN in situations that normally need it.

Public assistance like subsidized housing, driving license application, school registration and private health insurance can be acquired without SSN for non-citizens.

But without a social security number, financial institutions and banks will not be able to run security checks, which may prove to be a hindrance in getting a loan or a credit card.

There are also places where you do not have to provide an SSN, as basically anyone can ask for it. Medical providers can ask for your SSN, but you can leave that part blank.

They usually use it to track your medical records. You must keep your SSN safe because if it is stolen, it can be misused to take out loans in your name and will affect your credit scores.

Conclusion

Today Social Security Number is used for everything – from tracking lifetime earnings, calculating social security benefits, opening a checking account, to filling out a form at the doctor’s office.

Businesses can also ask for your SSN so that they easily identify you or your business history. In any given employement related situation, the employer should ask for the SSN only if absolutely necessary.

References

  1. About Social Security Number: Taken from en.wikipedia.org
  2. Purpose of Social Security Number: Retrieved from investopedia.com
  3. Requirement of SSN during Job application: Taken from iss.washington.edu

LEAVE A REPLY

Please enter your comment!
Please enter your name here