The president’s plans would allow undocumented immigrants to remain and work in the United States if they have lived in the country for at least five years and have children who are citizens or legal permanent residents. They would first have to register with the government and pass background checks.
Many Republicans are concerned because the immigrants could obtain Social Security numbers through Obama’s orders, making them eligible to apply for the Earned Income Tax Credit under Internal Revenue Service guidelines.
“The tax code shouldn’t reward those who broke our immigration laws,” Grassley said in a statement on Monday.
Other critics have said the tax credits would amount to “amnesty bonuses” or “amnesty rewards” for previously undocumented workers. Sen. Ben Sasse (R-Neb.) warned in a recent statement that they would “increase the burden on law-abiding taxpayers.”
But immigration advocates argue that undocumented workers already receive low wages for their jobs relative to legal employees, and that many of them pay taxes without being eligible for federal benefits.
“What do we as a nation gain by further impoverishing them?” National Immigration Law Center analyst Ellen Sittenfeld said, according to a recent AP article.
Some Republican lawmakers have exaggerated how much the Earned Income Tax Credit would benefit newly legal immigrants under Obama’s executive orders.
The Washington Post Fact Checker and FactCheck.org recently dinged Rep. Paul Gosar (R-Ariz.) for asserting that “each illegal alien will get $24,000 in compensation.” That figure actually represents the maximum amount that a family of three could receive if it filed in 2015 and amended its returns for the past three years.
Sasse made a similar claim, saying in his statement that Obama’s orders “may have blown open the doors for fraud with amnesty bonuses of more than $24,000 to those who receive deferred action.”
Conservatives generally support the Earned Income Tax Credit as a way to incentivize work and keep people off welfare. But the program is also susceptible to waste and abuse, with the government forking over $13 billion in improper payments in 2013 alone, according to the IRS inspector general.
Overall, the U.S. government paid out $70 billion in Earned Income Tax Credits, according to data from Congress’s Joint Committee on Taxation. The amounts range between $2 to about $6,100, depending upon a filer’s income and number of children.
Immigrants who apply for the tax subsidy under Obama’s actions would have to reconstruct their earnings and other records for the years in which they were unable to work on the books, a Treasury Department spokesman told the Fact Checker. Additionally, some might actually owe taxes after reporting past pay.