Thread: Filing taxes seen as path to citizenship

Filing taxes seen as path to citizenship

By SUMMER HARLOW, The News Journal

Posted Tuesday, April 17, 2007

Today is dreaded tax day for everyone, even undocumented immigrants.

Increasingly, immigrants who entered the U.S. illegally are filing tax returns and claiming hundreds of millions of dollars in refunds. They hope proof that they paid taxes and filed tax returns will help their citizenship applications under amnesty programs considered as part of a comprehensive immigration reform by Congress.

"If there's any immigration reform, this is a good way to show they were working like everyone else, complaining about taxes like everyone else," said Jorge Bravo, a tax preparer at Michael Eller Income Tax Service in Wilmington.

Most of Bravo's customers are Spanish-speaking immigrants, many here illegally.

To file the taxes, the undocumented immigrants are using Individual Taxpayer Identification Numbers, issued in lieu of Social Security numbers. Critics say that by allowing undocumented immigrants to file tax returns and claim refunds -- without any sort of information sharing between the IRS and immigration enforcement -- the government is sending a mixed message about immigration policy.

"It makes illegality seem normal," said Steven Camarota, director of research for the Center for Immigration Studies, which favors immigration limits. "It conveys to everyone that the United States is not serious about its immigration laws."

And while there's no doubt undocumented immigrants are paying taxes, there is disagreement on whether their tax contributions outweigh the cost of the services they use -- everything from free school lunches to costly emergency room visits.

Xavier Sanchez, a Mexican national who immigrated illegally, visited Bravo last week to file his state taxes. He'd already obtained a Taxpayer Identification Number and filed his federal return, and was looking forward to his refund to help take care of his family.

Plus, he said, he hoped that filing his return would help him gain residency.

"Everybody has to pay taxes to pay for benefits," said Sanchez, of Wilmington. "I'm doing my responsibility. I'm not a criminal; I work."

IRS paves the way

In 1996 the IRS created the nine-digit Individual Taxpayer Identification Numbers as a way to keep track of tax returns filed by people ineligible for Social Security numbers, such as foreign nationals.

The IRS doesn't track how many of the numbers are issued to undocumented immigrants. But anecdotal evidence suggests the numbers increasingly are being used by undocumented immigrants to file taxes, open bank accounts and obtain mortgages.

As of November, nearly 11 million Taxpayer Identification Numbers had been assigned since 1996. Although the numbers fluctuate each year, with a low of 60,863 in 1996, a record high of 1.5 million numbers were assigned last year.

Between 1996 and 2003, the tax liability for all returns filed with Taxpayer Identification Numbers totaled $48 billion. The total refund amount issued to people with the numbers during that same time period was $23 billion, according to the IRS. Like U.S. citizens, immigrants using the numbers are due a refund if they've overpaid their taxes.

Pedro Toala, who works with Bravo, said the number of Spanish-speaking immigrants using Taxpayer Identification Numbers to file tax returns has shot up about 75 percent in the past three years. Already this year, about 900 returns at his office had been filed using the numbers.

Most of those customers, Toala said, are interested in filing returns so they can get a tax refund.

"They've paid the government, and they want to get their money back," he said, just like everyone else.

A path to citizenship

Nationwide, immigrants are flocking to tax service companies.

Liberty Tax Service, which rolled out a program to target Spanish speakers in 2004, has seen a 200 percent increase over past year, with about 24,000 tax returns filed this year using the taxpayer identification numbers.

C.C. Chen, president of C&S Technologies Inc., said use of the company's bilingual eSmartTax software has tripled since it was introduced last year.

"Whether you're illegal or not, you're encouraged to pay taxes," he said.

The taxpayer numbers allow undocumented immigrants to be responsible taxpayers, even if they're not U.S. citizens, said Martha O'Gorman, vice president of marketing for Liberty Tax Service.

The fact is, she said, these immigrants are here, holding down millions of jobs, so at least this way they can contribute to the tax rolls.

"There's a horrible stigma out there about illegal immigrants, but most of them want to do right thing," she said. "They want to participate."

Camarota said that, in general, immigrants who are here illegally aren't using the identification numbers to pay taxes, but to get refunds.

"Illegals are smart enough to know if they owe taxes, they won't file a return," he said.

But Luz Diaz, director of Progreso Latino in Wilmington, which helps Spanish speakers file tax returns, said immigrants are paying what they owe.

"They want to pay taxes because they want to be here and stay here and become U.S. citizens," Diaz said. "They'll do whatever it takes, and they think it looks better on their behalf if they can prove they paid taxes. They think it will help them get some kind of permanent residency."

[/b]Critics point to administration[/b]

About half of tax returns filed lead to refunds, she estimated, and the rest owe. A typical refund, she said, is between $1,000 and $2,000, and the most she's seen anyone owe is about $800.

Tax preparers say that more undocumented immigrants are filing taxes, in part, because word has gotten out that obtaining a Taxpayer Identification Number is not the equivalent of walking into the lion's den.

The IRS is prohibited from sharing tax return information that might identify immigrants who are here illegally with the Bureau of Immigration and Customs Enforcement, which, according to the Inspector General's report, creates challenges for the IRS as tax law conflicts with immigration law.

The IRS also cannot report Social Security fraud to the Social Security Administration, even though a 2004 Inspector General's report found 265,000 Social Security numbers had been used fraudulently by undocumented immigrants filing tax returns in 2000. Another 89,000 used Social Security numbers the administration never issued.

"From a tax policy perspective, unauthorized resident aliens benefit from the tax law since they are treated virtually the same as U.S. citizens and lawful resident aliens," the Inspector General's report said.

Camarota said such a system means the administration really doesn't care about enforcing immigration policy.

"If you value the rule of law, this is very problematic," he said. "If we want to send a consistent message about immigration law, this is problematic."

Contact Summer Harlow at 324-2794 or sharlow@delawareonline.com.

http://www.delawareonline.com/apps/pbcs ... /1006/NEWS

The IRS is prohibited from sharing tax return information that might identify immigrants who are here illegally with the Bureau of Immigration and Customs Enforcement, which, according to the Inspector General's report, creates challenges for the IRS as tax law conflicts with immigration law.

This is an issue that needs fixed immediately. Why hasn't one of our Congressman submitted a bill to end this ridiculous situation? Obviously when one law conflicts with another it is irresponsible not to resolve the difference in the two laws.

"It makes illegality seem normal," said Steven Camarota, director of research for the Center for Immigration Studies, which favors immigration limits. "It conveys to everyone that the United States is not serious about its immigration laws."

And that is the message our government wants to send, so we calm down and REALIZE it is okay with them, so it should be okay with us!

IT IS NOT GOING TO HAPPEN!

The IRS doesn't track how many of the numbers are issued to undocumented immigrants. But anecdotal evidence suggests the numbers increasingly are being used by undocumented immigrants to file taxes, open bank accounts and obtain mortgages.

Is there anything we haven't done to make the lives of the illegals easier?

What, an illegal with an ITIN number can now attach a W-2 form to their tax return... bearing a fake or stolen SS#...and still receive a refund, including the EITC bonaza.

People, we have absolutely NO representation in Washington.

None.