Republicans Aim to Deny Tax Benefits to Former Undocumented Immigrants

Rebuffed in their efforts to roll back President Obama's executive orders on immigration, Republicans in Congress have a new plan.

TARGET BREACH

Senator Charles "Chuck" Grassley, a Republican from Iowa, questions witnesses during a Senate Judiciary Committee hearing in Washington, D.C., U.S., on Tuesday, Feb. 4, 2014.

Photographer: Andrew Harrer/Bloomberg

After failing to reverse President Barack Obama's action easing deportations of undocumented immigrants, Republicans are redirecting their "anti-amnesty'' efforts to deny a federal tax benefit to families who were previously undocumented.

 Senator Charles Grassley of Iowa and 10 of his Republican colleagues introduced legislation Tuesday that would prohibit workers covered by Obama's November immigration order from claiming the earned income tax credit for past years in which they worked without legal papers.

"This tax credit is meant to help the working poor get into the workforce,'' Grassley said in a statement. "It isn't meant to benefit individuals who aren't authorized to work in the United States.'' The tax credit is eligible to working families with children that have incomes lower than $39,131 to $53,267.

While the Republican legislation probably won't garner much support from Democrats, it signifies the Republican Party's plan to try to stop undocumented immigrants from receiving benefits -- and their hope that it will help them politically.

Republicans would need at least six Democrats to join them to advance the bill. The party was blocked by Democrats in their months-long offensive to roll back Obama's orders temporarily protecting about 5 million immigrants from deportation.

The new bill speaks to the anxieties fueling the Republican Party's immigration stance—that some undocumented workers are taking U.S. jobs or unfairly receiving federal benefits.

It comes after John Koskinen, the Internal Revenue Service commissioner, confirmed that workers who previously paid taxes and filed returns—including those who were previously undocumented, who have new Social Security numbers—are eligible for the tax credit. The legislation would deny benefits for the current tax year and all previous years in which the workers filed returns.

The effort reinforces an unfair perception that most immigrants are eligible for the same federal benefits used by low-income U.S. citizens while robbing the poorest families with children of a tax benefit they've earned by working in the U.S., says Ellen Battistelli, a policy analyst at the National Immigration Law Center.

She said this feeds an incorrect assumption that undocumented workers claim popular U.S. tax benefits.

Among the programs for which they're ineligible are Medicaid, the children's health insurance program, food stamps and temporary assistance for needy families. Even green card holders are ineligible for Medicaid and food stamps for the first five years they have legal status. Most often, they also must have paid 10 years of payroll taxes to qualify for Social Security retirement benefits and Medicare.

"Now that they've denied them eligibility for safety-net programs they're going after their eligibility for earned benefits,'' Battistelli said. Seventy five percent of families claiming the benefit make less than $25,000 annually, she said."They're trying to kick in the head these families who've been here five years or more and have U.S. citizen children,'' she said. "It's just so hard to fathom.''

Grassley cited a nonpartisan Joint Committee on Taxation estimate that his proposal will save $1.7 billion over 10 years in payments that would have otherwise been granted.

Yet eliminating the deferred action programs in the U.S. would increase the budget deficit through 2025 by a total of $7.5 billion as these workers are paying taxes, according to the non-partisan Congressional Budget Office. The programs will generate $22.3 billion in revenue from 2015 to 2025, according to the CBO. Battistelli accused lawmakers of trying to ``score political points'' with their party base through the legislation.

"I will continue to do all that I can to stop this executive immigration overreach and will fight to prevent the IRS from doling out hundreds of millions of taxpayer dollars to those who broke our immigration laws,'' said Senator Johnny Isakson, a co-sponsor of the bill and a member of the Senate Finance Committee that has jurisdiction over tax policy.

—Richard Rubin contributed to this story.

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