House Reconciliation Closes Loophole Granting Illegal Immigrants Child Tax Credits for Those Living Outside the U.S.
May 10, 2012
House Reconciliation Closes Loophole Granting Illegal Immigrants Child Tax Credits for Those Living Outside the U.S.
(WASHINGTON) – On Thursday, the U.S. House of Representatives passed a major reconciliation spending package that included $316 billion in proposed cuts and reforms over the next decade, and $39 billion in total spending cuts in Fiscal Year 2013. But, in addition to the spending provisions that advanced out of the House Budget Committee – on which Congressman Tim Huelskamp of Kansas serves – was a provision to close a major loophole that undocumented workers have been exploiting in the tax code.
As Treasury Inspector General for Tax Administration reported in July 2011, and as an Indiana television station widely reported, undocumented workers have been claiming refundable tax credits for children who are not living in the United States. Refundable credits are those that can result in refunds even if a filer has zero tax liability. Exploitation the child tax credit has cost taxpayers billions. The Ways and Means Committee believes the provision passed will save taxpayers at least $7.6 billion over the next decade.
The reconciliation measure that passed requires that every tax filer file a Social Security number for each child they claim the credit.
“Undocumented workers claiming credit for children who have never lived here is fraud, pure and simple,” Congressman Huelskamp said. “And, too many in Washington have looked the other way for too long. Washington is making a bad problem worse by allowing illegal immigrants to exploit American taxpayers to their advantage. $1 billion in credits in 2005 was enough for sure, but $4.2 billion in 2010? That is completely unacceptable. I am glad we were able to advance from the House Budget Committee a measure to close this loophole, I am pleased that the House passed it, and I look forward to the Senate’s consideration and ultimate passage of this reconciliation package.”
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