The American Council of Immigration does not approve or oppose candidates for elected offices. We aim to provide an analysis of the impact of elections on the US immigration system.
Written by Stephen Hubbard and Michaela McConnell
Tax day is approaching, but the Trump administration’s efforts to deport the U.S. have made many undocumented immigrants reluctant to file taxes. Some people worry that providing personal information to the Internal Revenue Service (IRS) will be used against them.
Undocumented immigrants pay billions of taxes each year. But the Trump administration’s efforts to register the IRS to increase immigrant arrests and deportation have spread fear into what has become a common practice for filing taxes. The federal government risks reducing the tax revenues the US has long relied on, especially as the IRS already expects a 10% decline by April 15th compared to 2024.
The battle over immigration tax data
A recent Washington Post investigation revealed that the Department of Homeland Security (DHS) has requested the IRS to provide housing addresses for 700,000 suspected taxpayers, which have not been documented. The IRS initially rejected it, citing the tax privacy laws. However, the Washington Post reported on March 22 that the IRS was approaching an agreement to share confidential taxpayer information with the DHS. The agreement allows the IRS to cross-reference the names and addresses of individuals with a final deportation order filed by the DHS. Many tax and immigration advocates explain the misuse of tax data for immigration enforcement.
Representative Debbie Wasserman Schultz and more than 60 other representatives have sent letters requesting the IRS abuse of private data from taxpayers targeting immigrant families with no criminal history.
Traditionally, the IRS has reassured immigrants who have not been documented that their information is confidential and not shared with other federal departments. Many undocumented immigrants file their taxes in the hopes of proof of contribution if a path to future legal status emerges.
Additionally, Elon Musk’s Department of Government Efficiency (DOGE) pursues sensitive taxpayer data and cross-references with other agencies that provide public interest. However, Doge’s move to retrieve data from the Social Security Administration was recently blocked by a federal judge.
These moves raise concerns about violating tax privacy laws and put many undocumented immigrants in a difficult position given the risks they face when filing taxes.
Many tax and immigration experts emphasize that failure to submit taxes can have serious consequences, from penalties for tax avoidance to negative impacts on return cases, i.e., negative effects such as naturalization applications. However, a history of tax compliance serves as a strong record of immigration cases and can demonstrate compliance with legal and financial liability.
Undocumented immigrant taxes
In addition to the individual effects of not paying taxes, there are many things that the community is going to lose if immigrants stop paying taxes.
Most undocumented immigrants are not covered by a Social Security Number (SSN) and file income tax returns using individual taxpayer identification numbers (ITINs). According to the Institute for Taxation and Economic Policy (ITEP), between 50% and 75% of undocumented immigrant households use ITIN to file their tax returns.
ITINS allows individuals without SSNs to pay taxes, comply with federal and state tax laws, and contribute to the local, state and federal economies, and file tax returns. Undocumented immigrants frequently use itins, but they are not the only ones. Foreign citizens who reside in the United States for a short period of time, or who work in the United States and non-citizen spouses of US citizens may also use Itins.
In 2023 alone, undocumented immigrant households donated $89.8 billion in taxes, with $55.8 billion in federal income taxes and $33.9 billion in state and local taxes. Their tax contributions help millions of Americans maintain public services and programs that rely on things like schools, health systems, infrastructure and social programs.
It is important to recognize that undocumented immigrants make significant tax contributions despite being excluded from many benefits funded by these taxes. For example, despite contributing billions to the system, they are not eligible for Social Security benefits. They also cannot claim the Acquisition Income Tax Credit (EITC), a tax benefit that supports low-income working families. They may only qualify for the Child Tax Credit (CTC) if the child has a valid SSN.
Results of weaponization of tax information
Migrants have long contributed to the economic well-being of the country in many respects, regardless of their status, particularly by paying taxes. This April, which includes not only tax days but also Trump’s 100th day inauguration, will serve as a key indicator of how current administrative priorities and rhetoric are shaping tax returns.
Submitted: Personal Tax Identification Number, Trump Administration
