Tuesday, April 24, 2012

Illegal Aliens and Income Taxes

The DNews published "Thousands of undocumented workers in Utah file taxes" last week promoting the idea that illegal aliens are actually "law-abiding" residents just waiting for citizenship.

There was, of course, no comment about the illegality of her employment, merely that she had a Social Security issued before she overstayed her student visa.  She says,  "You have to pay taxes,"  "That's the way that you know that you have for sure some kind of security."

Two questions, how much taxes might she have paid?  What type of security is she concerned with?  One could assume FICA taxes for Social Security retirement.   (Though that payment possibly won't provide any benefit)

How about Income Tax?    In a quick analysis with an online Income tax calculator (TTax), it shows a divorced illegal alien declaring a $30,000 income with three dependents a standard deduction and without any tax withheld would receive a REFUND of $5,270 for federal income taxes!!!
That's a fairly good incentive to file.    (With a $40,000 income she only gets a refund of $1,936, at $25K the refund goes to $6,825) 

The article refers to them as "invisible taxpayers" - but, they may very well be paying an "invisible" tax!!

Worried about legality of dependents? The site declares "The person MUST BE a U.S. citizen, resident, national, a resident of Canada or Mexico . . ."

However, just to be fair TTax says the illegal alien filer would be responsible to pay $466 to the state of Utah  -  which would not quite cover the $18,000 for educating the three dependents. 


2 comments:

Positiverealist said...

I don't defend the act of illegal immigration but understanding that if they are caught crossing it is a criminal act and they are deported. The law however should be changed because as it stands if they make it over without getting caught it is not criminal it is only a CIVIL infraction "unlawful presence" That is why their (ICE/USCIS) hands are tied when trying to find these people and deport them.

One benefit of her filing taxes would be that the immigration judge may look upon her as trying to what is right rather than hiding and not filing as many do. Many of them use false SS numbers in fact they paid over 11 billion into the mismatched social Security fund last year. They won't get that money back.

Since they all pay rent and landlords pay property taxes out of that rent they end up paying into the education system although your point is well taken that even that amount of tax does not make up the difference needed to pay for the education of the children.

As far as the legality of these people working goes the US sends them mixed messages. The US Supreme Court ruled in 2009 that using false documents in order to get work was not the same as using false documents to take out loans which would be prosecuted as Identity theft. Some states however have local laws that would go against this. Over a billion in crops rotted in the field within the last year because US Citizens would not show up to do the work and nor would the Prisoners that the Gov set up to do the work either.

We need to look for solutions to these issues and fining them as we would for other Civil infractions would be a good start to getting them documented, fingerprinted, their picture taken etc... this does not mean we would put them ahead of anyone that applied legally but at least we would know who they were, how many of them there are etc... Currently they say they think there are about 12 million but it could be has high as 20 million and 4 million US Citizen children that would go into state programs if those people were deported as well has millions of mixed families that would be affected as well. Fining them $5000 or $10,000 each would be a good start to documenting them so we would get a good data base to start with.

Anonymous said...

An illegal immigrant should not be allowed to have a tax refund, absolutely not!

If an illegal immigrant by his or hers own means is capable of surviving in this economy with ones own skill and business knowhow then whatever money is earned from such skills, without the unlawful employment through business, should be given to taxes without a refund. A tax refund is the privilege of a citizen.

It should be asked which such skills could allow such an illegal immigrant to survive in our economy. A business service provided with ones own hand which, according to law, does not exceed a certain amount and requires no business for employment, like selling hand made furniture for ones own survival, breaks no law. Whatever money is earned from such a trade is taxable and deserves no refund.