Millions of immigrants, who were previously living in the U.S. illegally but have now benefited from President Barrack Obama’s executive actions shielding them from deportation, could now claim up to four years worth of tax credits designed to benefit low-income workers, according to a report by the Associated Press.
Immigrants who benefited from Obama’s executive actions on immigration included those who came to the U.S. as children and others whose children are U.S. citizens or legal residents.
During the years they lived in the country illegally, many immigrants paid taxes that were used to fund federal government programs for low-income people, although they were not allowed to benefit legally.
But with the administration’s executive action having made millions of immigrants eligible to receive Social Security numbers and thus file returns to claim tax credits, some Republicans in Congress are expressing opposition to illegal immigrants benefiting from tax credits, saying that it amounts to the administration offering “amnesty bonuses.”
According to the Associated Press, congressional Republicans are set to clash with Democrats by pushing a Department of Homeland funding bill to block the tax credits. Observers say that in the situation in which current funding for the department expires on February 27, a standoff between Democrats and Republicans could lead to a shutdown of the department.
Congressional Republicans have made clear in the past their opposition to the Obama administration’s moves to prevent millions of immigrants from being deported.
Protesting, Rep. Sam Johnson (R-TX-3), senior Republican on the House Ways and Means Committee, said, “I represent hard working, law-biding Texans. I think these amnesty rewards, and that’s what they are, need to be stopped.”
However, immigration advocates ask why immigrants who paid as much as $100 billion in Social Security payroll taxes in the past decade during which they lived in the U.S. illegally cannot also claim the same tax credits as others.
Advocates also point to the fact that although millions of immigrants paid taxes, they were never able to benefit from the programs their taxes funded.
Official figures showing how much illegal immigrants, estimated to be about 11 to 12 million, have paid in taxes to Social Security are impressive. According to the Associated Press, from 2003 to 2012, illegal immigrants earned nearly $750 billion in wages although nearly 7 percent of the wages were never claimed.
But many illegal immigrants work in the informal and underground sector of the economy and never report their income, and thus do not pay taxes. However, those who pay taxes receive Individual Taxpayer Identification Number (ITIN) issued by the IRS.
To encourage illegal immigrants to pay taxes, the IRS does not report this category of immigrants to the immigration authorities, according to IRS Commissioner John Koskinen.
“We don’t enforce the Social Security laws, we don’t enforce the immigration laws. In fact, the reason illegal immigrants file taxes with us is they know we aren’t sharing that data with anybody. We treat it as taxpayer-protected information…”
But despite the fact that some illegal immigrants pay taxes, they cannot benefit from federal programs, including those meant for the poor, such as food stamps program, unemployment benefits, Medicaid, and the administration’s Affordable Care Act (ACA).
Republicans are now concerned that Obama’s executive actions on immigration, through which millions of immigrants become eligible to receive Social Security numbers, could make them eligible for Social Security, Medicare, and other federal government programs.
They could also become able to benefit from Earned Income Tax Credit, EITC, which makes them eligible, with other low-income workers, to claim tax credits.
According to AP, some immigrants could also be able to file amended tax returns for up to three years to claim tax credits going back to 2011. Some could get as much as $24,000.
But some congressional Republicans are determined to prevent it if they can. According to Sen. Ben Sasse (R-Neb.), the Obama administration is opening the doors to fraudulent practices.
“The administration may have blown open the doors for fraud with amnesty bonuses of more than $24,000 to those who receive deferred action. This program severely undermines the White House’s lip-service to enforcing the law and would increase the burden on law-abiding taxpayers.”
But advocates argue that if immigrants can pay taxes, then they should also be able to obtain the same benefits as others.
What do you think?