Payee Number Requirements
There are five types of Comptroller-assigned Texas identification numbers (TINs):
- System-assigned 7 TINs — For sole owners who choose to be set up with a Social Security number (SSN) and individuals who are set up with an SSN or Individual Taxpayer Identification Number (ITIN).
- System-assigned 1 TINs — For sole owners who choose to be set up with an employer identification number (EIN) and business entities that are set up with an EIN.
- Comptroller-assigned 3 TINs — Referred to as “temporary numbers.”
- Comptroller taxpayer numbers — Restricted for Comptroller use.
- Agency repeater numbers — Based on the agency’s three-digit agency number.
System-Assigned 7 TINs
The Comptroller’s office no longer uses a sole owner’s or an individual’s SSN or ITIN as the base number for a TIN. To protect the confidentiality of the payees’ SSNs and ITINs, TINS assigns a randomly based 7 TIN for these payees. The 7 TINs are assigned to both payees and state debtors who are set up with an SSN or ITIN.
System-Assigned 1 TINs
The Comptroller’s office uses the EIN of a sole owner or business entity as the base number for a 1 TIN. The 1 TINs are assigned to both payees and state debtors who are set up with an EIN.
Comptroller-Assigned 3 TINs
Agencies may need to make payments to businesses located outside the United States or to foreign individuals who reside in the United States. Most payees have an SSN, ITIN or employer identification number (EIN), while others may not and may need to obtain a Comptroller-assigned 3 TIN (example: 31XXXXXXXXX).
Comptroller-assigned 3 TINs will only be provided for non-employee payment transactions processed through the Centralized Accounting and Payroll/Personnel System (CAPPS) or the Uniform Statewide Accounting System (USAS).
Noncompliance with the following policies may result in an audit finding that may prevent 3 TIN requests from being approved:
Do not submit requests if 3 TINs are to be used exclusively within the agency’s internal system and the agency does not intend to set them up in TINS, or will not be issuing non-employee payments through CAPPS/USAS.
The Comptroller’s statewide payroll systems do not use 3 TINs to process state employee payroll payments. Agencies must implement their own procedures to assign temporary identification numbers within their internal system for employees waiting to receive their SSNs.
- Do not request 3 TINs if they are to be altered in any manner. The 11-digit 3 TINs must be set up in TINS as assigned and without alterations.
- A single 3 TIN is restricted to a single payee. Similar to a 1 or 7 TIN that is assigned to only one specific payee, a 3 TIN must only be used for a single foreign entity or individual, and must not be reused for multiple payees.
- Do not set up TINs prefixed with a 3 or issue payments to 3 TINs if they have not been assigned by Payment Services, unless the 3 TIN is an agency repeater number. This ensures that payments do not bypass the warrant hold statutes or Internal Revenue Service (IRS) requirements for 1099 reporting, when applicable.
- Do not issue payments to a 3 TIN that is defined as a Comptroller taxpayer number (TP number).
- Do not set up hold records on a 3 TIN that is defined as a Comptroller taxpayer number. Payment Services will delete an agency’s hold records that are set up using a Comptroller taxpayer number.
Before an agency determines it needs a 3 TIN, it must first:
- Contact the individuals to verify whether they have an assigned ITIN issued by the IRS. If the payees filed federal taxes with the IRS, they received an ITIN, and the agency must use the ITIN to set up those payees in TINS. If a payee’s ITIN is expired, see Expired ITINs on the SSN/ITIN/EIN Validation Rules page.
- Perform a name search for the foreign entity or individual on the Payee Name Search (PAYNAM) screen to verify whether the payee already has an assigned 3 TIN or was already set up with different TIN. The user must have security access to search the PAYNAM screen.
Once the agency determines it needs a 3 TIN, the request must be submitted via email to email@example.com with the following information:
- Agency name and 3-digit agency number.
- Requestor’s name.
- Requestor’s work phone number.
- Payee type:
- Foreign business entity.
- Non-resident alien (cannot be “state employee”).
- Non-resident sole owner
- Date PAYNAM was verified and name of employee who verified PAYNAM.
- Purpose (e.g., vendor payment, grant payment).
The number of 3 TINs requested cannot exceed 25. Before an additional block of 25 TINs is requested, the prior block of 25 TINs must be set up in TINS. Exceptions may be made on a case-by-case basis.
When Payment Services approves the agency’s request, the 3 TIN will be returned via email. The agency must then set up the assigned 11-digit 3 TIN without alterations. Payment Services will monitor that the 3 TIN is set up in TINS. Additional 3 TINs may not be provided until the previously assigned 3 TINs have been set up. To set up 3 TINs with a foreign address, see Foreign Payees.
If your agency makes multiple or recurring payments for goods and services to a foreign payee, the payee should apply for an SSN, ITIN or EIN. Some countries have a treaty with the United States stating which entities are not required to have an EIN to do business within the United States. To determine if a foreign business needs an EIN, contact the IRS.
If the foreign payee was initially set up with a 3 TIN and then receives an SSN, ITIN or EIN:
- Do not process a new payee setup with their SSN, ITIN or EIN. Submit a Payee Change Request form (74-157) (PCR) to request a number change from the 3 TIN to the SSN-, ITIN- or EIN-based number. A payee must not be set up with multiple TINs; a number change ensures compliance with this policy.
- If the agency fails to submit a PCR for a number change and sets up the SSN-, ITIN- or EIN-based TIN, the agency must submit a PCR to request a merge from the 3 TIN to the 7 or 1 TIN generated for the SSN, ITIN or EIN.
- Do not submit a PCR using the same 3 TIN to merge multiple 7 or 1 TINs for different payees. Reusing the same 3 TIN for different payees is strictly prohibited. A number merge transfers all payments issued on the 3 TIN to all subsequent 7 or 1 TINs, and results in an erroneous payment history, which may adversely affect 1099 reporting and potential open records requests.
Note: Exceptions to these 3 TIN policies may be approved on a case-by-case basis. Submit requests to firstname.lastname@example.org describing the exception and justification for the exception.
Comptroller Taxpayer Number
A Comptroller taxpayer number begins with:
- 1XXXXXXXXXX that is based on the taxpayer’s EIN. Mail codes prefixed with a T (TXX) on the “1” EIN-based TINs are restricted for Comptroller tax-related payments.
- Do not issue payments to the 3 Comptroller taxpayer numbers. If the taxpayer number is a 1 EIN-based TIN, agencies may issue payments to the 1 EIN-based TIN, but must not use the T mail codes that are set up on the 1 EIN-based TIN.
- Do not set up payees with a 3 taxpayer number or set up new mail codes on a 3 taxpayer number.
- Do not make updates to 3 taxpayer numbers or T mail codes, even if the T mail code is on the 1 EIN-based TIN.
- Do not set up debtor hold records using a 3 taxpayer number. Payment Services will delete an agency’s hold records that are set up on a 3 taxpayer number.
These actions are monitored by Payment Services, and violations will result in:
- Inactivation of the 3 TIN that is defined as a Comptroller taxpayer number and its mail codes if set up by an agency.
- Deletion of hold records on a 3 TIN that is defined as a Comptroller taxpayer number.
Agency Repeater Numbers
Agency repeater numbers are used for interagency transfer voucher (ITV) transactions that typically do not issue payments, as well as reimbursement payments via USAS. They begin with 3, followed by the agency number repeated three times, and ending with a check digit. For example, the repeater number for agency 200 is 32002002007.
If you are responsible for handling ITVs for your agency and need assistance with this process, see USAS Interagency Transactions Web-Based Training.
Agencies are responsible for setting up their own agency repeater number, mail codes and direct deposit information in TINS. To prevent changes to your mail codes by other agencies, set the security level to 1 on each mail code.
- Do not process TINS updates to another agency’s repeater number or its mail codes.
- Do not set up new mail codes on another agency’s repeater number.
- Do not set up, update or cancel direct deposit information on mail codes for another agency’s repeater number. By setting up direct deposit on your agency’s mail codes, your agency becomes the custodial agency for the direct deposit information, which prevents other agencies from updating or deleting your agency’s direct deposit records.