Dependents for Federal Income Tax
Before you can claim your child as a dependent on your federal tax return, you must have his Social Security number -- this number is requested on the federal tax form. The Social Security number is how the IRS makes sure that you have a child to claim and that no one else is claiming the same child.
Dependents for State Income Tax
If you claim a child with a Social Security number on your federal income tax return, you can claim that child on the state return. Some states also request the Social Security number on the state return form, and others go by the information you entered on your federal return.
If you are claiming the Child Tax Credit, you must have a Social Security number for the child. The same holds true for the Child Care Credit. Children must have a current Social Security number if you plan to claim these credits. The same is true if you are claiming any college credit.
If your child has a bank account, you must give a Social Security number for the child if you use the child's name on the account. The child receives a statement detailing interest earned at the end of the year, as you would if you had an interest-bearing account.
Getting the Social Security Card
Since it takes about six-weeks to receive the card, you should apply for the card as soon as you can so that you have the number for tax time and any bank accounts. If the child is born in the last month of the tax year, you should apply for her Social Security card right away to receive it by the end of January or the beginning of February.
If you make any mistakes when applying for your child's Social Security card, it could hold up your tax returns. You must use the same name and birth date for the Social Security card on your federal tax returns. Any variations of the name and birth date will cause the IRS to reject your tax return.