@mktax File an extension. You are correct with what the PATH Act says. Therefore, if you were to file using your daughter's ITIN, you would need to amend by May 17th in order to apply the Social Security number. However, if you file an extension, the PATH Act will allow you to file using your daughter's newly acquired SSN (assuming the process is finished before October 15th), and have it applied to Tax Year 2020. This will allow you to claim the (potentially) $2000 Child Tax Credit (of which up to $1400) is refundable vs. the Other Dependent Credit, which is limited to $500 and is not deductible (can't contribute to additional refund if your tax is $0).
In addition, you could potentially qualify for two other credits: Earned Income Credit (if both you and your mate, if married, also have Social Security Numbers, and your income is "low enough"). In addition, if either you or your spouse (if filing jointly) has a Social Security Number, the daughter (if under 17 by the end of 2020) would also qualify for the Recovery Rebate Credit (or stimulus).
Therefore, it is worth it to wait to file to apply her Social Security Number. But to do so, you will want to file an extension so that the benefits can be claimed up until October 15th instead of expiring on May 17th. For additional information, you may also reference the following website: Who Qualifies for the Earned Income Tax Credit (EITC), where you'll see the following information:
Valid Social Security Number
To qualify for the EITC, everyone you claim on your taxes must have a valid Social Security number (SSN). To be valid, the SSN must be:
- Valid for employment
- Issued before the due date of the tax return you plan to claim (including extensions) (The preceding italics were added for emphasis)
For the EITC, we accept a Social Security number on a Social Security card that has the words, "Valid for work with DHS authorization," on it.
For the EITC, we don’t accept:
- Individual taxpayer identification numbers (ITIN)
- Adoption taxpayer identification numbers (ATIN)
- Social Security numbers on Social Security cards that have the words, "Not Valid for Employment," on them
For more information about the Social Security number rules for the EITC, see Rule 2 in Publication 596, Earned Income Credit.
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