Q. I've always heard that the Social Security card was for Social Security and tax purposes only. Yet every time I turn around, somebody is asking me for my number. Isn't there a law against using Social Security numbers for all those other purposes?
A. It's true that the Social Security Board designed the Social Security number in the 1930s just for Social Security purposes. But there are few legal restrictions on the use of the SSN.
With few legal restrictions, it was inevitable that the SSN would become a universal identification number. It's ideal for that purpose. Many people can have the same name, but the SSN is unique to each person. And virtually everyone has an SSN.
The Privacy Act regulates the use of SSNs by government agencies. It says that government agencies may request a customer's SSN only if a law specifically authorizes it. But there is no shortage of laws authorizing use of the SSN.
For example, the SSN serves as a taxpayer identification number for most Americans. So the Internal Revenue Code requires disclosure of SSNs to facilitate accurate reporting and taxation of income: employees must disclose their numbers to employers; bank customers must disclose to banks; other payees must disclose to other payers; so wages, interest and other taxable income can be reported to the IRS.
The Tax Reform Act of 1976 permits state and local governments to use SSNs for drivers' licenses, taxes, public assistance and vehicle registration.
Another federal law [U.S. Code 666(a)(13)(A)] requires applicants for government licenses or services to supply SSNs. A few examples: drivers' licenses, professional licenses, marriage licenses and divorce decrees. This information helps the states track down absent parents for child support enforcement purposes.
The rules for the private sector are looser because the Privacy Act applies only to government agencies. Businesses and other private organizations are free to request SSNs, and they are free to use them for any purpose that does not violate a law. Customers may refuse to disclose their SSNs, but private organizations may refuse to serve customers who won't disclose their SSNs.
Remember that giving your SSN to a business or other organization does not give them access to your Social Security records. Except for a few government uses required by federal law--like tracking down deadbeat parents--the privacy of Social Security's records is guaranteed by law.