Monday, September 05, 2011
(graphic: flippinsweetgear.com)
Illegal immigrants earned $4.2 billion in refundable Additional Child Tax Credits (ACTC) from the IRS in 2010, despite the fact that federal law prohibits unauthorized workers from taking advantage of other tax breaks.
The Treasury Inspector General for Tax Administration also reported that the government payout on the tax credit more than quadrupled in the past five years, from $924 million in 2005 to $4.2 billion in 2010.
Undocumented employees are able to file tax returns because the IRS issues individual taxpayer identification numbers (ITINs) for those lacking Social Security numbers. But federal law prohibits such individuals from utilizing the Earned Income Tax Credit and most federal public benefits.
In the case of the Additional Child Tax Credits, though, the law does not provide sufficient legal authority for the IRS to disallow the ACTC to unauthorized workers, according to the agency.
Advocates for undocumented workers note that they contribute billions of dollars to the Social Security and Medicare trust funds.
-Noel Brinkerhoff
Illegal Workers Got $4.2 Billion in Tax Credits (by Michael Cohn, Accounting Today)
IRS Allowed $4.2 Billion in Credits to Undocumented Workers, Audit Says (by Charles S. Clark, Government Executive)
Recovery Act: Individuals Who Are Not Authorized to Work in the United States Were Paid $4.2 Billion in Refundable Credits (Treasury Inspector General for Tax Administration) (pdf)
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