An estimated 4.2 billion dollars has been sent to families of illegal aliens in a single tax period through the Additional Child Tax Credit (ACTC), which offers up to $1,000 per child to all resident families, including illegal aliens. A new Center for Immigration Studies' report faults congressional inaction, inappropriately casual policy decisions by low-level IRS staff allowing payments to illegal aliens, and IRS process policies often allowing the submission of phony support documents. Much of this “paying-the-illegal-to-stay” pattern continues as a result of needlessly narrow IRS efforts to discourage and to detect fraud.
Congress has never specifically written that ACTC benefits could only be provided to those with Social Security numbers. And, although Congress did write into legislation in 1996 that no federal “grant or benefit” could be given to illegal aliens, it did not define the terms. So the IRS took on the policy role and, without even a notice in the Federal Register, determined that illegal aliens with Individual Taxpayer Identification Numbers (ITINs) could receive tax credits.
View the complete report at: http://www.cis.org/paying-illeglas-to-stay
“Illegal aliens certainly should not be securing checks from the U.S. taxpayer for non-existent children or for non-resident children,” said David North, CIS fellow and author of the report. “It's stunning that a multi-billion dollar decision to subsidize illegal aliens with this credit seems to have been made by mid-level IRS bureaucracy with no input from elected officials.”
Thanks in part to a journalist in Indianapolis who broke the ACTC story and shed light on this “income transfer program,” as well as reports by the Treasury Inspector General for Tax Administration, progress has been made in the application process resulting in a decrease in the issuances of ITINs. But even with the decrease, well over one million ITIN applications were received during the last half of 2012, representing an additional one million new alien arrivals (not all of them illegals).
Unfortunately recent changes deal exclusively with preventing future issuance of phony ITINs, not with seeking out past fraudulent ITINs that are still receiving ACTC payments. For example, the IRS probably won't be following up on the single address in Atlanta which received 23,994 ITIN-related tax refunds of the 8,393 which were deposited in a single bank account despite the obvious fraud.
The Center for Immigration Studies is an independent, non-partisan, non-profit research organization founded in 1985. It is the nation's only think tank devoted exclusively to research and policy analysis of the economic, social, demographic, fiscal, and other impacts of immigration on the United States.