The IRS Form W7 is submitted by nonresident individuals to apply for a U.S. Individual Taxpayer Identification Number (ITIN). An ITIN is required if a nonresident needs to file a federal income tax return.

In this example, we look at a nonresident who opens a singlemember disregarded LLC in Florida. The Florida LLC operates a local furniture store, which means the nonresident is engaged in a U.S. trade or business and generates effectively connected income (ECI). Even though the company operates at a net taxable loss, the nonresident must still file Form 1040NR.

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