To work in the United States, immigrants who are here illegally often use false social security numbers or ones that belong to other people. Then many file their income tax returns using a special number provided by the IRS. Those immigrants can file their taxes without fear of deportation as the IRS doesn’t report their illegal status to homeland security.
Come tax time, American citizens and residents are not the only ones lining up to file returns. On one particular day at the St. Mary’s University School of Law about 20 people are in a large mock courtroom awaiting their turn to see a tax professional. Every year, the university provides free tax filing assistance through a federal program known as VITA, the Volunteer Income Tax Assistance Program. Each week dozens of people line up to file their taxes.
“It’s anywhere from 70 to 130 [people] every Saturday,” said Rachel Rubenstein, the university’s senior tax fellow and coordinator of the VITA site on campus. “Honestly it’s really busy in February and always starts to slowdown as the tax season goes on.”
No one is turned away as long as they meet the low-income requirements; that includes immigrants who are here illegally.
“We are not allowed to turn away those people. We actually have to treat them with respect just like any other taxpayer,” Rubenstein said.
Regardless of citizenship status, the IRS requires everyone earning income in the United States to report it. There’s even a process for immigrants using fake social security numbers.
A woman we’ll call "Claudia" uses that process. She doesn’t want us to use her real name because she’s afraid of being deported.
She’s about 30-years-old and entered the U.S. three years ago from Mexico using a tourist visa. Then she just stayed. She gave her employer at a San Antonio hotel a fake social security number which the employer uses for income and payroll tax deductions reported to the IRS.
“We get social security [numbers] from other people or a fake one because we need something to work,” Claudia admits.
She provided the nine-digit number to a friend and he made the fake card she presented to her employer.
“We don’t get the job if we don’t present a Social Security card and it’s different when you pay cash because it’s harder to make the taxes,” she added.
Claudia said she wants to pay her taxes because she doesn’t want to be one of the immigrants you hear about - who’s described as a burden on the system. Others say they pay their taxes because they hope that someday they will qualify for legal status.
So-- why does the IRS turn its head when it knows a taxpayer is here illegally? Why doesn’t the agency report the person’s status to Homeland Security, which spends billions patrolling the border to prevent illegal immigration? Under IRS code, the agency doesn’t share citizenship information with immigration or other federal agencies except in extreme circumstances. The IRS twice declined TPR’s request for an interview, however, Rubenstein says that’s a part of Sec. 6103 of IRS code.
“They want people to feel like ‘you can come clean with us, file your taxes, do what you’re supposed to do, and we’re not going to share that information with the Department of Homeland Security,’” she said.
But it’s all a little more complicated than someone just paying into a system hoping to someday earn legal status.
The IRS probably knows Claudia is using a false social security number because she also has what’s called an ITIN, or Individual Taxpayer Identification Number.
The IRS created ITINs in 1996 for people who are not eligible for social security numbers. That includes migrants who are here illegally.
If they’re using someone else’s social security number, the IRS may expect the owner of that social to pay taxes on money the immigrant earned using that number.
Rubenstein says the IRS has deployed software that attempts to keep the legitimate social security holder from being penalized.
“They would file under the ITIN but then we report the wages earned under the social,” Rubenstein explains. “In the tax software we actually need to put in the social that [the income] was earned under and that way the matching occurs in the back end in the IRS computer systems and it actually, in a way, protects the true holder of the social security number.”
The IRS actually acknowledges all of this in writing in the manual used at the St. Mary’s taxpayer site. Rubenstein says the ITIN numbers can also be used to open bank accounts.
Even though the IRS will say ITINs are strictly for filing taxes, it has morphed into something a little more,” Rubenstein said. “It’s another number that says: this is a real person, this person earns money, this person can get a mortgage, can get a credit card.”
A 2010 report from the Social Security Administration estimates that 1.8 million immigrants used social security numbers that did not belong to them. It also estimates about 3 million immigrants without legal status paid social security taxes that year.
The IRS doesn’t have penalties for using a fake social but it’s still illegal. Workers like Claudia could be charged with a felony and get jail time. And if they ever qualify for legal residency or citizenship, they could lose the dream of legal status that prompted them to pay taxes in the first place.
Additional information on how the IRS handles ITINs and immigration is available here and here.
