Thread: Money Smart: Illegal Immigrants and Tax Refunds

Money Smart: Illegal Immigrants and Tax Refunds

(video at source)

KTLA News June 13, 2012


LOS ANGELES (KTLA) -- A new report reveals millions of illegal immigrants are getting billions of dollars in IRS refunds, leaving many Californians asking how, why and is it true?

According to the Center for Immigration Studies, in the 2010 tax year alone, undocumented workers received over $4 billion from the U.S. government.

As it turns out, a valid social security number isn't needed to apply for an IRS refund.

"If you don't have papers in this country and you are working, you can apply for an ITIN number and then you file taxes," Luis Salazar, of Salazar Tax Services explains.

"If you quality for a refund, you can get money back," Salazar says.

Since illegal immigrants can't qualify for legitimate social security numbers, back in 1996 the U.S. Treasury introduced the Individual Tax Identification Number, or ITIN.

Salazar says he sees thousands of U.S. dollars returned to his clients who are from out of the country.

"You can claim your daughter, you can claim your son, you can claim your grandfather, grandmother," he explains.

"You can claim your mother, you can claim your father, you can claim nephews and nieces. Almost everybody besides cousins."

And that's how the money is banked -- all through the Additional Child Tax Credit, which grants families $1,000 per dependent.

That's also where the scam can come in.

The people who you claim should be living in the U.S. with you, but Salazar says that some undocumented workers claim family members living across the border.

Unscrupulous tax preparers are filing fraudulent returns getting ITIN clients thousands of dollars.

One report found an undocumented worker claimed 20 relatives as dependents under a fake address and took the government for a grand total of $29,000.

Salazar Tax Services insists that every claim they file is above the board.

But they also say that not everyone chooses to be money smart over greed.

"I give you the option, like it's not correct, but if you want to claim it's up to you becasue you're the person in charge of your taxes because you're signing it," Salazar says.

source: Money Smart: Illegal Immigrants and Tax Refunds - ktla.com

This is tax fraud and should be grounds for deportation.