Johnson bill to end tax credit to illegal immigrants
May 24, 2011 -
To root out waste, fraud and abuse, today U.S. Congressman Sam Johnson (3rd Dist.-Texas), introduced the Refundable Child Tax Credit Eligibility Verification Reform Act, H.R. 1956.
The commonsense bill would require tax filers to provide their Social Security numbers to claim the refundable child tax credit. Because this credit is refundable, as it stands parents who owe no taxes can receive cash back from the government for their children through the tax code.
In recent years, the number and dollar amount of improper payments arising from refundable tax credits has been increasing at an alarming pace. Over the last few years, the rampant abuse and misapplication of these credits has cost taxpayers an estimated $106 billion. Unfortunately, this refundable tax credit can be provided to an illegal immigrant so long as the immigrant is able to obtain an Individual Taxpayer Identification Number (ITIN) from the IRS.
“Illegal immigrants may not only be receiving this public benefit through the tax code but may also be tempted to come to the U.S. because of it. This is just plain wrong,” stated Johnson, who serves on the tax-writing Ways and Means Committee as well as the Joint Committee on Taxation.
According to the March 31, 2009, report by the Treasury Inspector General for Tax Administration entitled “Actions Are Needed to Ensure Proper Use of Individual Taxpayer Identification Numbers and to Verify or Limit Refundable Credit Claims,” this tax credit “appears to provide an additional incentive for aliens to enter, reside, and work in the U.S. without authorization, which contradicts Federal law and policy to remove such incentives.'”
“It’s time to close the loophole in the tax code that allows illegal immigrants to claim the refundable child tax credit. This simple change can go a long way toward protecting precious taxpayer dollars,” concluded Johnson.
On Wednesday the Ways and Means Oversight Subcommittee will hold a hearing on improper tax payments in the administration of refundable tax credits.