Some of our customers have a Matricula Consulate card issued by Mexico and an Individual Taxpayer Identification Number (ITIN) issued by the IRS. Should we have them sign the W-8BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting) or W-9 (Request for Taxpayer Identification Number and Certification)? What about a customer who presents a Matricula Consulate card but does not have an ITIN?

We recommend using the W-9 form for customers who are resident aliens and the W-8BEN form for nonresident aliens.

The W-9 form itself states that it may be used by a U.S. citizen “or other U.S. person.” A “U.S. person” includes “an individual who is a U.S. citizen or U.S. resident alien.” On the other hand, a W-8BEN instructions state that this form should be used for nonresident alien individuals (a separate W-8BEN-E form is used for foreign entities).

If a customer has a Matricula Consular card but has not obtained an ITIN, then FinCEN guidance indicates that your bank should make a risk-based decision as to whether it will accept the Matricula Consular card, alone, as identification. For customers lacking an ITIN, your bank may wish to provide copies of the application, Form W-7.

For resources related to our guidance, please see:

IRS Publication 515, Withholding of tax on Nonresident Aliens and Foreign Entities (“Form W-9. In most cases, you can treat the payee as a U.S. person if the payee gives you a Form W-9. The Form W-9 can be used only by a U.S. person and must contain the payee's TIN. . . . Forms W-8. In most cases, a foreign payee of the income should give you a form in the Form W-8 series.”)

IRS Form W-9, page 2 (“Definition of a U.S. person. For federal tax purposes, you are considered a U.S. person if you are: An individual who is a U.S. citizen or U.S. resident alien; . . .”)

IRS Form W-9 Instructions, page 2 (“Form W-9 (or an acceptable substitute) is used by persons required to file information returns with the IRS to get the payee’s (or other person’s) correct name and TIN. For individuals, the TIN is generally a social security number (SSN). However, in some cases, individuals who become U.S. resident aliens for federal tax purposes are not eligible to obtain an SSN. This includes certain resident aliens who must receive information returns but who cannot obtain an SSN. These individuals must apply for an ITIN on Form W-7, Application for IRS Individual Taxpayer Identification Number, unless they have an application pending for an SSN. Individuals who have an ITIN must provide it on Form W-9. . . .”)

IRS Form W-8BEN Instructions (“Form W-8BEN will continue to be used to document nonresident alien individuals, while Form W-8BEN-E will be used to document foreign entities . . . .”)

FFIEC Q&As (2007) (“E1.Q: There have been many requests for us to accept the Matricula Consulate card. Everything I read on this indicates most of these cards are fraudulent and there is no way to verify their legitimacy. Nevertheless, there are many banks accepting them. How are they doing due diligence on these accounts?

“E1.A: You are correct in that a number of banks accept consular identification issued by foreign governments to their citizens living abroad. While concerns have been voiced regarding the Matricula Identification (ID) cards, conflicting views exist on their usage and acceptance, and to date there is no Federal guidance in this area. The CIP rule neither endorses nor prohibits bank acceptance of information from these particular types of identification documents issued by foreign governments, such as the Matricula ID. Instead, a bank must decide for itself, based upon appropriate risk factors, whether the information presented by a customer is reliable. If your institution accepts consular identification, as a best practice, additional safeguard steps should be considered and incorporated into your CIP program. For example, one safeguard practice we have observed is the contacting of the closest Mexican Consulate office to verify validity of the issued ID.”)

IRS Form W-7, Application for IRS Individual Taxpayer Identification Number

IRS Webpage, Individual Taxpayer Identification Number (“IRS issues ITINs to help individuals comply with the U.S. tax laws, and to provide a means to efficiently process and account for tax returns and payments for those not eligible for Social Security numbers. They are issued regardless of immigration status, because both resident and nonresident aliens may have a U.S. filing or reporting requirement under the Internal Revenue Code. ITINs do not serve any purpose other than federal tax reporting.”)