Top of IRS Form W-7
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Top of IRS Form W-7 by public document
Apperently, some on the right have finally discovered that many resident aliens actually do have IRS identification numbers that allow them to file and pay their federal income taxes and receive some tax benefits.
For years now right-wing conservatives have complained that undocumented aliens (by which they usually mean all non-citizens of color) don't pay taxes and are a burden to taxpayers. This has never been entirely true, of course. Even setting income taxes and payroll deductions aside, all resident aliens pay sales taxes, property taxes (sometime indirectly by paying rent), gas taxes, cigarette taxes, tolls, fees, etc. But the biggest misconception has been that resident aliens don't pay income taxes when, in fact, many if not most do pay income taxes. Even my liberal friends have had a hard time believing this.
For more than forty years the IRS has issued a nine-digit Individual Taxpayer Identification Number (IRS application form W-7) to resident aliens who are not eligible to apply for Social Security. These identification numbers may be issued to resident aliens who earn income in the U.S. and either have a "Green Card" eligibility or meet the "Substantial Presentence" eligibility test. In fact, the instructions on the W-7 states, "A foreign individual living in the United States who does not have permission to work from the USCIS, and is thus ineligible for a SSN, may still be required to file a U.S. tax return." They therefore must obtain an Individual Taxpayer Identification Number (ITIN). So regardless of how a foreign citizen came to be here, if they earn money while here they are required to file income taxes. For example, a foreign citizen who came here in January and earned money and is still here in December must file income taxes and apply for the ITIN by attaching the application to their return.
Depending on their status and circumstance they may also be eligible to receive federal tax rebates and some other benefits under the tax law for themselves or their dependents. This includes the Child Tax Credit when a dependent child is a citizen or meets criteria in the IRS code. What resident aliens cannot collect is the Earned Income Tax Credit. It says so right on the ITIM application.
These IRS-issued ITINs have be around at least since the 1960s but some on the right want to use this rediscovered revelation to accuse President Obama of buying votes by making the IRS issue Child Tax Credits to "illegals." This claim ignores the fact that all resident aliens are ineligible to vote. Some conservatives also want to pin on Obama their outrage that undocumented aliens are even allowed to report income without the threat of deportation. They would prefer, I suppose, that undocumented aliens be exempt from paying income tax, or else be forced to hide their income out of fear of instant deportation.
Immigration enforcement is not the job of the IRS. It is their job to collect taxes on all residents who earn income regardless of whether they are citizens. It will be interesting to see if this issue gains traction or finds its way into round 2 of the immigration-reform debate on the horizion.