Illegal Aliens to Get $24,000 “Amnesty Bonus”

Amnesty Bonus

President Barack Obama’s executive amnesty allowing an estimated 5.5 million illegal immigrants to remain in the country without fear of deportation comes with a big payday for the gatecrashers covered by the order.

So says Ms. Eileen J. O’Connor, a tax lawyer and the former head of the tax division of the United States Department of Justice in congressional testimony before the Senate Homeland Security Committee said yesterday.

According to O’Connor, those affected by the President’s “deffered action” on deportation will receive social security numbers making them instantly eligible for tax “refunds” under the Earned Income Tax Credit (EITC) provision in the tax code – a wealth transfer scheme worth more than $6,000 a year in cash payments to low wage and no wage people who file tax returns.

That’s not all. Persons living in the U.S. illegally under the president’s order can also file amended tax returns going back three tax years meaning they could receive a whopping $24,000 in tax (cash) credits.

According to O’Connor:

“In 1999, the Chief Counsel’s office of IRS ruled…that when a person receives a social security number, he can file amended returns to claim the credit for the three preceding years during which he did not.

“The logic is puzzling: the credit is not available if you don’t have a social security number, but you can receive it retroactively for years during which you did not qualify for it because you didn’t have a social security number.”

Committee member Senator Ben Sasse (R-NE) described the payments as “amnesty bonuses” leading Sasse and Homeland Security Committee Chairman Senator Ron Johnson (R-WI) to pen as letter to the U.S. Treasury Department Office of Inspector General that reads in part:

“By offering illegal aliens new payments under the Earned Income Tax Credit, the IRS may encourage fraud from those claiming children living in other countries. The Administration may have blown open the doors for fraud with amnesty bonuses of more than $24,000 to those who receive deferred action,” Sasse says in the statement.

“This is basic economics: if you want more of something, you subsidize it. By subsidizing illegal entry with four years’ worth of new tax credits, the IRS would promote lawlessness. This program severely undermines the White House’s lip-service to enforcing the law and would increase the burden on law-abiding taxpayers.”

In a separate statement, Senator Ron Johnson writes:

“Most notably, qualifying applicants for the president’s programs can now claim thousands – even tens of thousands – of dollars in payments from the Earned Income Tax Credit and, for some, the Additional Child Tax Credit (ACTC).

“The EITC and ACTC programs, ‘which cost taxpayers $89.6 billion in 2013, were responsible for $21 billion in improper, potentially fraudulent payments that same year.’”

The letter signed by Sasse and Johnson posed nine direct questions for the inspector general:

  1. “Is…“Ms. O’Connor’s testimony an accurate description of the effects of the President’s executive actions?
  2. Given the high rates of fraud in both tax credit programs, is there an incentive for tax filers to fraudulently claim more children than they have?
  3. To be eligible for the Additional Child Tax Credit, is a tax filer required to provide a Social Security Number for each claimed child?
  4. Is it possible for individuals to claim tax benefits under either program for children that do not live in the United States? If so, can you estimate the amount of fraudulent claims?
  5. If someone with children who has worked in the United States receives deferred action and gets a new Social Security Number, but has never filed their taxes, what is the highest amount that person might receive under both tax credit programs?
  6. What additional tax benefits might someone be eligible for with a Social Security Number that they would not have been eligible for with merely an Individual Tax Identification Number?
  7. What do you estimate will be the full cost of providing EITC benefits to illegal aliens under the President’s executive actions?
  8. How many people do you estimate will be eligible for EITC benefits under the President’s executive actions who were not previously eligible?
  9. Is the Internal Revenue Service equipped to detect and prevent fraud as it processes millions of new claims for EITC benefits?”

The letter was sent to the Treasury Department today. Calls to the Senator Johnson’s office concerning the timing of a response from the treasury department Inspector General had not been returned by press time.