Posted by: Ann Corcoran | January 14, 2012

Illegal aliens “bilking” billions from taxpayers

That is what a Texas Congressman says as he leads the charge to change how illegal aliens can get child tax credits.  They need only file a return using an Individual Taxpayer Identification Number (ITIN), not even owe any taxes, but get a redistribution of your money.   I told you about this shocking program here and here.

Now the issue is welling-up as part of the discussion on the payroll tax holiday, reported here at Politico:

As talks resume in Congress on paying for the payroll tax holiday, Republicans are proposing to find billions in savings by denying child tax credit refunds to working-class immigrant parents who lack a Social Security number proving they are authorized to work in the U.S.


…. leading the charge for the GOP is no less than Texas Rep. Sam Johnson, an emotional icon for House Republicans because of his seven years as a POW in Hanoi during the Vietnam War. And armed with a Treasury report from this summer, the 81-year-old Air Force veteran has exposed a real Achilles heel for Democrats in using the tax code as an anti-poverty program.

Indeed, the past decade has seen a genuine explosion in the cost of refunds paid out by the government under the child tax credit, first created in the post-welfare reform period of the late 1990s. The annual cost was less than $1 billion a year prior to 2001, when President George W. Bush greatly expanded the credit. And in 2009, President Barack Obama went a big step further by making it easier for lower-income families — with little or no federal income tax liability — to still claim the refunds.

Treasury data show that 21 million tax filers in 2011 claimed the refundable credits, which averaged about $676 per child and totaled $26.1 billion. That’s more than some Cabinet departments spend annually, and represents a five-fold increase since 2002, when the cost was closer to $5 billion.

Problem is that you don’t need a Social Security number to get the Additional Child Tax Credit!

The tax credit itself, which Bush increased from $500 to $1000 per child, is immensely popular with middle-class households, reducing their tax burden and helping a working mother offset child-care costs, for example. For lower income families, the cash refunds — technically called the Additional Child Tax Credit — are also an income supplement and anti-poverty tool, much like the older, more established Earned Income Tax Credit.

One big difference is that a 1996 law specifies that the EITC refunds can go only to households in which the wage earner has a Social Security number. The ACTC, enacted later and quite small when it started, was never subject to this restriction because its advocates argue that it is aimed at the child and the legal status of the parent should matter less.

Adding insult to injury, CASA de Maryland gets grants from the Internal Revenue Service (Dept. of the Treasury) to teach illegals how to file tax returns.

Johnson wants a fix that includes requiring a Social Security number for all those seeking this tax “refund.”  Refund is a misnomer because in many cases these tax filers do not even owe any taxes!

Last year, illegal immigrants bilked $4.2 billion from U.S. taxpayers due to a loophole with the refundable child tax credit,” the congressman said in a floor speech following the Treasury’s IG report. “With the dire need to cut government spending, I hope this simple fix gets a serious look as a way to stamp out waste, fraud and abuse.”

Read the whole article to see how the other side justifies this windfall.  The gist of their argument is that since these filers pay into Social Security and have little chance of getting that back some day (because they are here illegally), they might get it back now by having lots of babies (and claiming the credit).  Oh, brother!    But, the way Social Security is headed down the tubes, no legal citizen is going to get their money out someday either!

You might want to check in with your Representatives in Congress and get them on record as to whether they approve of this redistribution of your tax dollars.

Readers:  I have one more post today on an immigration issue and then I’ll shut up on the topic for awhile—for at least a day!


  1. […] I told you about the ‘child tax credits’ where illegal aliens could file a tax return even if they didn’t make enough money to pay […]

  2. […] reported several times on these pages about the Child Tax Credit (here is one link from January of this year)—a refund by the IRS for the children in your home EVEN IF YOU […]

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