Illegal Aliens Get Billions in Tax Credits from IRS

Townhall.com ^ | September 5, 2011 | Mike Shedlock

[Kaslin]

According to a Treasury Inspector General audit, Individuals Who Are Not Authorized to Work in the United States Were Paid $4.2 Billion in Refundable Credits

Redaction Legend:
1. Tax Return/Return Information
2(f). Risk circumvention of agency Regulations or Statutes

IMPACT ON TAXPAYERS

Many individuals who are not authorized to work in the United States, and thus not eligible to obtain a Social Security Number (SSN) for employment, earn income in the United States. The Internal Revenue Service (IRS) provides such individuals with an Individual Taxpayer Identification Number (ITIN) to facilitate their filing of tax returns. Although the law prohibits aliens residing without authorization in the United States from receiving most Federal public benefits, an increasing number of these individuals are filing tax returns claiming the Additional Child Tax Credit (ACTC), a refundable tax credit intended for working families. The payment of Federal funds through this tax benefit appears to provide an additional incentive for aliens to enter, reside, and work in the United States without authorization, which contradicts Federal law and policy to remove such incentives.

WHAT TIGTA FOUND

Claims for the ACTC by ITIN filers have increased from $924 million in Processing Year 2005 (the calendar year in which the tax return was processed) to $4.2 billion in Processing Year 2010. Clarification to the law is needed to address whether or not refundable tax credits such as the ACTC may be paid to those who are not authorized to work in the United States. *********************2(f)*********************************** Also, employees in the Accounts Management Taxpayer Assurance Program are not taking steps to notify taxpayers when it is obvious their SSNs and names have been compromised.

TIGTA also found that a feature on tax preparation software programs which automatically takes the taxpayer identification number and enters it as the identifying number for the taxpayer’s Wage and Tax Statements ******************2(f)*************************************.

WHAT TIGTA RECOMMENDED

TIGTA recommended that the IRS work with the Department of the Treasury to seek clarification on whether or not refundable tax credits may be paid to individuals who are not authorized to work in the United States. TIGTA also recommended the IRS require individuals filing with ITINs and claiming the ACTC to provide specific verifiable documentation to support that their dependents meet the qualifications for the credit, including residency, and that questionable Child Tax Credit (CTC) and ACTC claims on ITIN returns **********2(f)*******************************. The IRS should also notify taxpayers when their SSNs are compromised and ensure that software packages do not auto-populate an ITIN onto Wage and Tax Statements.

IRS management agreed to discuss with the Department of the Treasury the issue of ITIN filers’ ACTC eligibility. The IRS did not agree to require additional documentation to support CTC and ACTC claims on ITIN returns ********************2(f)*********************************** The IRS is exploring options to alert taxpayers whose SSNs have been compromised and plans to address software that auto-populates an ITIN onto Wage and Tax Statements and take sanctions for noncompliance.

 

American Recovery and Reinvestment Act of 2009 Made Fraud Easier

The Washington Post commented on the fraud in Undocumented workers got billions from IRS in tax credits, audit finds

Sen. Orrin Hatch (R-Utah), ranking member of the Senate Finance Committee, On Friday announced plans to examine the refunds.

“The disconcerting findings in this report demand immediate attention and action from Congress and the Obama Administration,” Hatch said in a statement.. “With our debt standing at over $14.5 trillion and counting, it’s outrageous that the IRS is handing out refundable tax credits...to those who aren’t even eligible to work in this country.”

Wage earners who do not have Social Security numbers and are not authorized to work in the United States can use what the IRS calls individual taxpayer identification numbers. Often these result in fraudulent claims on tax returns, auditors found.

Their data showed that 72 percent of returns filed with taxpayer identification numbers claimed the child tax credit.

Changes to tax law are partly to blame for the explosion in refunds for additional child tax credits in recent years, auditors found. Before 2001, filers needed to have three or more children to qualify — and to owe more Social Security taxes than earned income credits.

But those requirements have been eliminated and the allowable refund for each child doubled. The American Recovery and Reinvestment Act of 2009 also made the refund easier to get, auditors found.

Fraud and government programs go hand-in-hand.

In my opinion we should kill this ridiculous program entirely. The next best alternative is to not grant any credits to anyone who does not have a social security number and is not a US citizen.

[Bernard]

ITIN's start with a 9 (SSN's start with everything but a 9) and any decent tax prep software prevents that ITIN from claiming EITC or any of the other refundable credits ITIN holders are not entitled to.

The government gets copies of W-2's where an ITIN holder gets credit from an employer and the SSN is a valid SSN, not the ITIN the return is filed under. a simple matching program could identify all tax cheats using this scam to get the benefit of working in this country while committing identity theft. Even Timothy Geithner could follow that trail, if he chose to do so.

[bcsco]

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[beebuster2000]

well this answers one question i have had. here in california with the state Dream act, the libs always say “so they can get an education and pay taxes”, I always wondered: how does an illegal pay taxes? they cant get a SS number and so cant file a return?

now i see, the feds have bypassed the SS requirement, and you can file a return even if you are illegal. oops, that means you get money back not pay taxes !!

but not too worry, its worth it becasue you now support the “community” which will vote solid democrat.

[all the best]

“so they can get an education and pay taxes”

That is in itself disturbing. I am not interested in more money going to fund even bigger government. People don’t exist so that one day they can pay taxes.

[McLynnan]

Is it too much to expect our government to use a bit of oversight when they distribute our tax dollars? There is no excuse for this sort of dereliction of duty especially when the fraud is so easily identified and prevented.

[Kaslin]

It shouldn’t be.

[DJ Frisat]

"Illegal Aliens Get Billions in Tax Credits from IRS"

Mr. Obama, I submit that THESE are "tax expenditures that we can no longer afford."

Screw these leeches who don't think they have to play by the rules. And screw you ruling-class a**holes who look the other way to buy their votes to help increase your power.

[Kaslin]

Illegals don’t pay income taxes because they are getting paid under the table, but why are they getting paid under the table? I guarantee you, its because so the employers who hires the illegals does not have to pay their part of the social security tax, while taking it out of the pay of the illegals and putting in their own pockets instead.

[Liz]

In the last five years, some 2.3 million illegal immigrants decided they were "entitled" to money intended for low wage US citizens............and the IRS paid them. Word spread throughout the Third World.......now EITC payouts to illegals grew fourfold over the last five years.

The US Treasury report noted that paying these credits to illegals is explicitly prohibited by U.S. law, which holds that those unauthorized to work here cannot receive federal benefits.

The IRS claims it's not its job to check the immigration status of those requesting U.S. money (easily done if a filer has a valid Social Security number instead of a "taxpayer ID"). The tax agency apparently thinks laws only apply to people it audits — not politically sensitive illegal aliens. So now we have the sorry spectacle of $4.2 billion in money from law-abiding taxpayers flowing to law-breaking foreigners who belong in other countries. No wonder the U.S. has some 12 million illegal immigrants, rolling in by the thousands daily in part from the well-established human smuggling rackets controlled by Mexico's drug and crime cartels. (Excerpt) Read more at investors.com ...

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NOTE WELL: Earned Income Tax Credit is available to immigrant workers who obtain legal work status. But the law allows immigrants to claim EITC for up to three years prior to obtaining that status. Conniving illegals simply file a tax return for the years in which they were not legally eligible to work in the US.

The most widespread EITC abuse stems from the requirement that children live with the worker for more than six months of the year. IRS does little to verify the claim.

Many immigrants falsify govt forms (a felony), claiming non-existent children, or claim children who they’ve left behind with relatives. Those with two or more children and income below $32,121 could get as much as $4,008. It is estimated that illegals got $22 billion EITC refunds.....it probably is much, much more.

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ONE ILLEGAL WITH MULTIPLE IDENTITIES RIDES THE US GRAVY TRAIN An illegal alien w/ wife and five children violates our borders. He gets a job mowing lawns for $5.00 or 6.00/hour. At that low wage, with six dependents, he pays no income tax, so each year, he files an Income Tax Return to get "EITC---earned income credit" of up to $3,200 scot-free.

The one identity qualifies for Section 8 housing and subsidized rent. He qualifies for food stamps and no deductible, no co-pay free health care. His children get free school breakfasts and lunches. The kids qualify for monthly SSI checks, faking ADD; the illegal and his wife get SSI if they fake being aged, blind or disabled; SSI qualifies them for Medicare.

Plus illegals don't worry about pricey items like car insurance, life insurance, or homeowners insurance, and qualifies for relief from high energy bills.

==================================

IRS “Rule 2. You Must Have a Valid Social Security Number (SSN)

To claim the EIC, you (and your spouse if filing a joint return) must have a valid SSN issued by the Social Security Administration (SSA). Any qualifying child listed on Schedule EIC also must have a valid SSN. (See Rule 8 if you have a qualifying child.)If your social security card (or your spouse’s if filing a joint return) says “Not valid for employment” and your SSN was issued so that you (or your spouse) could get a federally funded benefit, you cannot get the EIC. An example of a federally funded benefit is Medicaid.If you have a card with the legend “Not valid for employment” and your immigration status has changed so that you are now a U.S. citizen or permanent resident, ask the SSA for a new social security card without the legend.”I copied this from IRS Publication 17. It states that you must have a valid SSN to get the Earned Income Tax Credit.

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THE LUCRATIVE PHONY ID BUSINESS---DOCUMENTS FOR A PRICE

NORTH BERGEN, NJ -- July 21, 2006 -- Pelcastre brothers, Angel and Jorge, Dallas, Texas, were a walking threat to US national security, expert document forgers who, for a few thousand dollars, could give anyone a new identity, L/E said.

The Texas brothers turned a NJ hotel room into a business office and were readying a massive cache of fake Social Security cards for delivery to a local NJ identity broker. The Texas brothers were a "one-stop shop" for a myriad of fake US documents, including birth certificates, Social Security cards, driver's licenses for any state in the US, passports and resident alien cards, said state police.

Officers happened upon two cars bearing Texas plates in a NJ hotel parking lot. Authorities wouldn't identify the NJ hotel by name for fear it would spark retribution from savage drug cartels operating in the US.

The Texas brothers were followed to a NJ office supply store nearby where they purchased computer supplies. Officers then followed the Texans to a NJ storage facility in Secaucus, NJ, where the Texans loaded several boxes into a car. One of them stood lookout.

L/E approached the Texas brothers when they returned to the NJ hotel and questioned them separately. The Texas brothers consented to a search.

Police recovered laminating sheets with built-in security features, pages of blank documents waiting for fake names and information, finished documents, computers and software to create the fake IDs.

All told, the haul was worth about $500,000 on the street. Police also recovered $6,000 in cash, which was the first payment from a NJ fake document broker for a shipment of 500 fake Social Security cards. ####

==========================================

CONSIDER THIS Organized latinos are putting out vast amts of agit-prop.......wanting politicians to think they are numerous....and have large numbers of votes to pressure pols into facilitating their political agenda.

Fact is most of these people have numerous identities. They get SS nos for anchor babies and use the nos themselves to suckup numerous US govt freebies using multiple identities.

Illegals are more likely to be collecting government checks than picking crops, despite the incessant latino propaganda.

Illegal Jose Madrigal, the Washington state rapist, had some 30 identities.

Another illegal (one of many) collected $3 million in UI checks under multiple identities.

Illegals are well-briefed on US law WRT getting on the gravy train----most of the US tax dollars they score are sent back home to Third World hellholes where they intend to retire.......as the US govt checks keep rolling in.

"Impoverished illegals" buy identities like they were doritos .....the "poor" aliens lay out several thousands of dollars for each identity.

[Texan]

Illegals don’t pay income taxes because they are getting paid under the table

It's not just illegals. Plenty of citizens want to be paid under the table as well. This is money they don't report as income. They also want to work under someone elses SS#. That way they can continue to claim SSI, SSD and other benefits.

As an employer, I've had these requests. End of job interview as far as I'm concerned.

[Kaslin]

There is probably a reason why ss numbers don't start with a 9, just like the reason that social security checks are never deposited in the first week of the month. For example my birthday is August 6 and I have to wait until the 2nd Wednesday of the month until my check is deposited. If I am lucky the second Wednesday falls on the 7th. My husband on the other hand, whose birthday is April 20, and gets his check deposited on the 3rd Wednesday of the month never has to wait for his check. Many times it gets deposited before the 20th

[kt56]

Well that settles it. From now on I’m illegal. Where’s my money.

[RWGinger]

Thank you for posting this.

EVERY FREEPER should call or email our Congresspeople tomorrow as they are back in DC

The IRS rules that “ seem” to allow this must be changed and NOW so we won’t pay illegals billions more next year

PLEASE EVERYONE GET IN TOUCH WITH YOUR CONGRESS PEOPLE

again, thanks for posting

[HiJinx]

Ping!

Some more details on the billions of dollars given to illegals by the IRS.

[SunkenCiv]

Thanks Kaslin.

[WOBBLY BOB]

BTTT

[dennisw]

It is simple enough to prevent or outlaw those who file via an ITIN from filing for Additional Child Tax Credit (ACTC). That you must file taxes under your SS number to qualify for Additional Child Tax Credit (ACTC)

I think you are saying this too. Just another way the Federales spit in the face of American taxpayers, the Federales don’t give a crap about giving billions to illegal aliens and don’t care about closing our borers to illegal aliens and visa overstayers

[bitt]

My Senator assures me that NO FEDERAL FUNDS are spent on illegal aliens, including benefits to Auntie Zietuni and Uncle Omar.

He’s an asshat, though - what does he know???

Send THEM videos of checkout lines and EBT card users.

Send THEM videos of public housing and all the satellite dishes hanging from every apartment (so they can get spanish stations from home)

Send THEM videos of emergency rooms where our kids with broken legs wait while aliens’ kids get xrays and AMBULANCES FOR THE SNIFFLES.

Send THEM videos of small town schools and the increasing burdens of teaching “English as a second language” classes.

ETC. ETC....

If these asshats actually spent some time with normal Americans who could drive them around their districts and SHOW THEM WHAT IS GOING ON, maybe they’d listen to us.

But NOOOOOOOOO, on their months off, they’re taking ‘junkets’ to India or visiting their vacation homes in Ireland....