Democratic Underground Latest Greatest Lobby Journals Search Options Help Login
Google

Undocumented workers got $4B tax credits

Printer-friendly format Printer-friendly format
Printer-friendly format Email this thread to a friend
Printer-friendly format Bookmark this thread
This topic is archived.
Home » Discuss » Editorials & Other Articles Donate to DU
 
alp227 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 04:42 PM
Original message
Undocumented workers got $4B tax credits
Undocumented workers received $4.2 billion from the Internal Revenue Service last year, according to a new study.

The report, released Thursday by the Treasury Inspector General for Tax Administration, showed that the IRS allowed people unauthorized to work in the United States to collect billions of dollars in refundable tax credits in 2010, The Washington Post reported.

Under current law, individuals not permitted to work in the U.S. do not receive most federal public benefits but an increasing number are filing tax returns claiming the Additional Child Tax Credit, which is set up for working families. The IRS says the law as presently written is vague and does not permit them to disallow the claims.

Clarification is needed on this issue, TIGTA J. Russell George said in a press release. The Internal Revenue Service should work with the Department of the Treasury to clarify whether this credit, which is based on earned income, should be paid to those who are not authorized to work in the United States.

Read more: http://www.politico.com/news/stories/0911/62566.html

Most likely this is because those workers had kids born in the US who are citizens per the 14th amendment and Civil Rights Act of 1866. (Politico didn't mention this, and I think that the "illegal immigrants taking welfare" thing is a gross oversimplification that ignores the birthright citizenship issue.)
Printer Friendly | Permalink |  | Top
orpupilofnature57 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 04:44 PM
Response to Original message
1. How did their Employers make out ,or should I say Off with?
Printer Friendly | Permalink |  | Top
 
hedgehog Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 04:48 PM
Response to Reply #1
2. BINGO!
Printer Friendly | Permalink |  | Top
 
gateley Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 04:53 PM
Response to Reply #2
3. Yeah, those regs wouldn't be in place if the Republicans weren't
benefitting in some way.
Printer Friendly | Permalink |  | Top
 
DURHAM D Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:01 PM
Response to Reply #1
5. I don't understand your comment.
Please explain how an employer could benefit?
Printer Friendly | Permalink |  | Top
 
hfojvt Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:06 PM
Response to Reply #5
8. very easily
because the employer hires undocumented workers they can pay $1 or $2 or $3 less per hour and also not pay benefits. For every worker they hire at $2 an hour less, they make an extra $4,000 a year in profits for a full time worker. Not paying benefits saves $560 a year on 10 paid holidays (at minimum wage) and another $560 a year for two weeks of vacation/sick leave.

There's at least $5,000 per worker.
Printer Friendly | Permalink |  | Top
 
DURHAM D Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:08 PM
Response to Reply #8
9. In order for this to work the employer has to be running a cash business.
Please give me a list of those businesses likely to be running on a cash basis.
Printer Friendly | Permalink |  | Top
 
hay rick Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:16 PM
Response to Reply #9
12. hair and nail salons, landscaping companies,
car washes, restaurants, building contractors...
Printer Friendly | Permalink |  | Top
 
DURHAM D Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:22 PM
Response to Reply #12
15. Within the past decade a very large number of
landscapers and contractors have been audited by the IRS. They were targeted and paid dearly. I think to a lesser extent restaurants have been through the same experience but I think those were mostly handled by the state. Don't know about the other two you mentioned but can tell you that many business owners that used to try various tricks have stopped it altogether. It doesn't pay.
Printer Friendly | Permalink |  | Top
 
hfojvt Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:18 PM
Response to Reply #9
14. Why do they need to be running a cash business?
They simply offer a job with no benefits at minimum wage. The only people who apply for such a job are undocumented workers for whom this is a lot of money. If they didn't have that pool to hire from, they would be forced to pay more and offer benefits in order to get workers.

I also wonder if the state really audits employers to make sure they are paying minimum wage. If nobody complains, can they get away with paying less? And if people are undocumented, they won't dare complain.
Printer Friendly | Permalink |  | Top
 
DURHAM D Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:24 PM
Response to Reply #14
16. To start you need to be thinking about the revenue side of the equation.
Printer Friendly | Permalink |  | Top
 
orpupilofnature57 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 07:38 PM
Response to Reply #9
21. Any Service industry ,or vendor .
Printer Friendly | Permalink |  | Top
 
hedgehog Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 06:24 PM
Response to Reply #5
20. Every time someone takes a job for so little money that the rest of us
end up pitching in with a tax credit, we're in effect supporting the employer who is getting the labor at a lower rate.

In other words, raise the minimum wage so no one is eligible for a tax credit and the employers wil be paying a proper wage.
Printer Friendly | Permalink |  | Top
 
hfojvt Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 04:53 PM
Response to Original message
4. aren't there a number of undocumented workers
who have fake documentation?

Because they need fake SSNs in order to get jobs.

But then don't they pay taxes and also collect benefits under those fake SSNs?
Printer Friendly | Permalink |  | Top
 
DURHAM D Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:05 PM
Response to Reply #4
7. The SS administration just takes their funds and the matching funds of their employers.
The SS is aware of those numbers that are not good. I don't believe they (payers) will be able to collect benefits (SS & Medicare) later on those bad numbers. IOWs - illegal immigrants are contributing to the fund for the benefit of others.
Printer Friendly | Permalink |  | Top
 
hfojvt Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:12 PM
Response to Reply #7
11. but they should also be paying state and federal taxes
and then can collect refunds on those, large refunds if they have kids, they get several thousand in EIC, and they can collect unemployment as well, if they get laid off.
Printer Friendly | Permalink |  | Top
 
DURHAM D Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:18 PM
Response to Reply #11
13. You just changed the subject.
I was responding to your comment about benefits.

With regard to paying federal and state income taxes (if the state has income tax) the employer withholds the employees funds and deposits it with feds and the state each month. Many undocumented workers do not file tax returns so they do not use those deposited funds. I have no idea what the ratio of filers to non-filers is but many just leave their withheld income with the feds and state forever.
Printer Friendly | Permalink |  | Top
 
hfojvt Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:25 PM
Response to Reply #13
17. no, because unemployment compensation and the EIC are also benefits
I never said anything about social security. The word I used was "benefits". Thats's a general word, not one that just means "social security benefits".
Printer Friendly | Permalink |  | Top
 
DURHAM D Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:33 PM
Response to Reply #17
18. Given that it is a Politico article they left out an important part of the equation.
The undocumented workers may have received billions of dollars in income credits but in the aggregate they pay in many times that 4 billion each year that they (the group category) will never get back in benefits.

Are you certain they get unemployment benefits? Their bad SS numbers may prevent that.
Printer Friendly | Permalink |  | Top
 
orpupilofnature57 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 07:56 PM
Response to Reply #18
22. They're Victims ,and your right there is no way they get benefits.
Printer Friendly | Permalink |  | Top
 
Booster Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:03 PM
Response to Original message
6. Wasn't this some sort of agreement worked between Bush and
Fox? I also remember Bush saying that even undocumented workers who used false names could collect. Can you imagine how many are going to take advantage of that. Oh, wait. I'm mistaken - that was for social security not tax credits, although this may have been worked out at the same time.
Printer Friendly | Permalink |  | Top
 
leveymg Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Sep-04-11 05:11 PM
Response to Original message
10. They've also paid in many multiples of that amount that will never be withdrawn
from the fund because undocumented were working under false SS numbers.

This is not a problem, from an accounts perspective, anyway.
Printer Friendly | Permalink |  | Top
 
JNinWB Donating Member (190 posts) Send PM | Profile | Ignore Sun Sep-04-11 05:46 PM
Response to Original message
19. Undocumented workers do not have valid SS #s.

If they give the employer a false number, all payroll info will be assigned to that number. Employers can check to make sure that the applicant and number they provide are accurate.

Also, the SS Adm occasionally contacts employers asking them to verify that the SS # and individual match. Some workers may be using the numbers of close relatives---cousins, uncles, brothers.
Printer Friendly | Permalink |  | Top
 
DU AdBot (1000+ posts) Click to send private message to this author Click to view 
this author's profile Click to add 
this author to your buddy list Click to add 
this author to your Ignore list Mon Dec 29th 2014, 09:21 AM
Response to Original message
Advertisements [?]
 Top

Home » Discuss » Editorials & Other Articles Donate to DU

Powered by DCForum+ Version 1.1 Copyright 1997-2002 DCScripts.com
Software has been extensively modified by the DU administrators


Important Notices: By participating on this discussion board, visitors agree to abide by the rules outlined on our Rules page. Messages posted on the Democratic Underground Discussion Forums are the opinions of the individuals who post them, and do not necessarily represent the opinions of Democratic Underground, LLC.

Home  |  Discussion Forums  |  Journals |  Store  |  Donate

About DU  |  Contact Us  |  Privacy Policy

Got a message for Democratic Underground? Click here to send us a message.

© 2001 - 2011 Democratic Underground, LLC