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Friday, September 02, 2011

Gov’t Audit: Illegal Immigrants Received $4.2 Billion in Tax Credits Last Year

H/T Cyndi Kuhlman who shared link to this article on the Conservative Voices Group on FaceBook
by Madeleine Morgenstern, TheBlaze: Illegal immigrants not authorized to work in the United States received $4.2 billion in tax credits from the IRS last year, almost quadruple the amount five years ago, a government audit found.

The Treasury Inspector General for Tax Administration (TIGTA) found an increasing number of illegals are claiming a refundable tax credit meant for working families when they file their taxes. Those who claim the credit either reduce what they owe or receive refunds.

According to TIGTA, which independently oversees the IRS, this essentially provides a huge incentive for illegals to come, live and work in the U.S.:
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.
The $4.2 billion amount is a dramatic increase from $924 million in 2005. According to the audit, 72 percent of people who used a taxpayer identification number to file taxes last year claimed the child tax credit, up from 51 percent in 2005. Comparatively, just 14 percent of those who filed regular tax returns last year claimed the credit.

According to the Washington Post, the explosion in claims is due in part to tax law changes that reduced the number of children required to claim the credit. Additionally, the American Recovery and Reinvestment Act of 2009 also made the refund easier to get.

In response to the report, the IRS agreed to consult with the Treasury Department but said it doesn’t have the authority to stop the claims, pointing out the law doesn’t require the taxpayer or their claimant child have a Social Security number to receive the credit. Legislative changes would be required for any real change.

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Blogger Bill Smith said...

Wish we could get this $4.2 billion back - no wonder they can't afford to build the border fence.

9/2/11, 7:29 PM  
Anonymous Florida Tax Man said...

Double blow, First they are illegal immigrants who have taken American jobs and on top of that are claiming refunds on the taxes.

9/2/11, 7:59 PM  
Blogger Brittanicus said...

The IRS reported it has issued 10.8 million ITINs (Individual Taxpayer Identification Numbers), with a very few being used by celebrities for book signing, foreign investors and whatever other reason? So at the most must leave roughly 10 million illegal aliens as heads of household that have arrived in violation of the law, hired as an infringement of the law, and using ITINs to skirt the law, since the program began in 1976. The Treasury Inspector General for Tax Administration on Thursday released an account, unveiling that the Internal Revenue Service, returned $4.2 billion dollars in refundable tax credits 2010 to illegal aliens. Using IRS ITIN numbers so illegal aliens are paying into the US taxation system, but are collecting in ‘earned income child tax credits,’ most of this money back. An illegal alien cannot qualify for a legitimate Social Security number, to file income tax returns, so they use the ITIN number issued by the IRS.

This questionable program was intended to assuage that tax burden on the lowest American income earners, but in recent years has shown to be rife with fraud. President Obama’s stimulus program included tax cuts for low-income workers. Obama’s intention was, to put cash back into taxpayers’ hands, so they will spread it around to heighten the economy. But thanks to the (EITC) Earned Income Tax Credit, the majority of this “tax relief” will go to individuals who have never paid anything in taxes—and have already defrauded prior administrations and today’s government in massive sums each year—to Illegal aliens. .” The Inspector General said that the IRS should require those claiming the credit to prove that they are actually eligible to work here legally? However, IRS management “claims” that they have no legal power to request any proof with the inspection of individual income tax forms. A copy of the Inspector General's report can be found here:

An IRS audit showed that 72 percent of tax returns filed by those using (ITIN) taxpayer identification numbers and not a Social Security numbers claimed the child tax credit. Nearly all ITIN-based returns include W-2 forms that list Social Security numbers, belong to U.S. citizens, IRS data shows. Foreign Nationals use the stolen or fabricated Social Security numbers to gratify the employment necessities of businesses. In violation of the law, the ITIN numbers have also involved in using the IRS number as Identification to open bank accounts and obtain driver’s licenses and to vote.

Illegal aliens as well as Americans are cheating the rest of the taxpayers, with Mothers filing under their Maiden name for perhaps two children, then the Father filing for the same two children as a different tax return under his family name and both receiving child refund tax return dollars. Of course, as always this is just the tip of the iceberg on fraudulent returns.

9/3/11, 3:19 PM  
Blogger Brittanicus said...

Frosty Wooldridge wrote for News with Views:

"Your U.S. Congress participates in and supports one of THE most fraudulent taxpayer abuse schemes ever concocted within the Federal Government. It’s time the administration put its foot down rather than allow millions of unlawful immigrants to step onto American soil—while soaking billions out of the U.S. Treasury.

Since the Earned Income Tax Credit (EITC) became part of the income tax code in 1975, it has quietly become the largest cash transfer program in the United States. At a cost of more than $44 billion per year, EITC spending dwarfs that of the traditional welfare program—Temporary Assistance for Needy Families (TANF)—and food stamps combined. More than 23 million households currently receive the credit.

Edwin Rubenstein exposed one of the most dramatic tax frauds ever on the American taxpayer: “Defrauding the American taxpayer,” Volume 19, Number 3, spring 2009, Social Contract, “The Earned Income Tax Credit and Illegal Immigration - A Study in Fraud, Abuse, and Liberal Activism.”

“More than one in four immigrant households received the EITC in 2000—nearly twice the 13.2 percent rate of house-holds headed by Native Americans. And because immigrant households are larger via higher fertility, their EITC payments are larger than those received by native households.

“Bottom line: Immigrants accounted for about 13 percent of the U.S. population in 2008 but receive an estimated 26 percent of EITC benefits—about $12 billion.”
The most distressing aspect of EITC stems from unlawful immigrants tapping into the program on a massive scale. For example, in Greeley, Colorado this year, district attorney Buck Young raided a tax filing agency to find over 1,000 fraudulent returns by unlawful workers. While they paid little or nothing in taxes, they received hundreds of thousands in bogus returns, costing taxpayers millions of dollars. That same scam multiplies all over the country.

9/3/11, 3:19 PM  
Blogger Brittanicus said...

“Tax relief" goes to people who never paid a cent in taxes, and may have already defrauded the government of huge sums each year. "EITC scams are common, well-organized, and massive," Rubenstein writes in the report. EITC ranks second out of 57 government programs in fraudulent payments.

“But enthusiasm for the credit has blinded policy makers to its problems. The EITC program is dominated by fraud. Year after year about one-third of all EITC returns are based on illegal multiple returns, phony Social Security numbers, or claims of non-existent children or spouses. A disproportionate share of illegal alien households receives the benefit.

“For most poor families, the tax credit check is the largest single sum of money they will receive during the year. Most receive it after filing income taxes. But some need the money immediately, and they can get it—for a price. A niche financial sector thrives by lending EITC recipient’s immediate cash in return for a hefty chunk of their credit check. The cost to the poor of these so-called Refund Anticipation Loans (RALs) has been estimated at 6 percent of the entire EITC program.

The EITC is the most illegal-immigrant friendly of poverty programs; illegal immigrants constitute a far larger share of the poverty population now.

Implication: The EITC is a textbook case of unintended consequences. Our economic meltdown may be among them."

There is only one cure for the corruption in federal agencies and that is joining the TEA PARTY. Thousands of fraudulent programs will be exposed and billions of dollars will be saved. This confronts the rot that has entered the Democratic and the Republican parties, and the astronomical deficit that America is suffering from. Read some unrevealed evidence at Judicial Watch, that is a legal non-profit, being There the opposite to the Communist backed ACLU; a panderer to the illegal alien invaders. In addition, NumbersUSA gives you in depth analysis of costs to taxpayers and insider news from Congress. Lastly, the controversial website of “American Patrol” gives you one-click Bridging editions to the nationwide media, where the truth prevails. It is no wonder that millions of illegal aliens can send $46 billion dollars a year to families, via foreign banks?

1. Remember illegal aliens do vote in federal elections, and we all need to contact our politicians, to either issue an official to scrutinize voter rolls, or specifically absentee ballots.
2. ISSUE a mandatory federal ID card, for all Americans.
3. Make illegal entry punishable as a felony, not a civil offence.
4. Build the real 2006 Double border Fence.
5. The TEA PARTY will not tolerate illegal immigration or any form of amnesty, including Sanctuary cities, dream acts or covert enactments by disguising Immigration Reform.
6. The TEA PARTY will support Arizona, Alabama, Georgia and other states against any retribution by the Democratic or Republican establishment.
MY EARLIER BLOGS: http://brittanicus-enoughiseno...

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9/3/11, 3:20 PM  
Blogger Bill Smith said...


Good points. And offers good reasons why we should eliminate the income tax and IRS and go to the FairTax.

9/3/11, 4:54 PM  

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