Immigrants' Rights Update

Immigrants' Rights Update Index
Immigrants’ Rights Update Volume 21, Issue 4 \| May 10, 2007
IN THIS ISSUE
Special Report Confiscating Contributions \| Proposals requiring legalized workers to forfeit Social Security credit for their prior work and tax contributions would impoverish future citizens, burden state and local governments, frustrate efforts to correct Social Security records, and undermine immigration reform.
New on NILC’s Website (since April 25, 2007) REAL ID Proposed Regulations: Comments Submitted by NILC to Dept. of Homeland Security, May 2, 2007 Written Statement of Tyler Moran, NILC Employment Policy Director, to the House Committee on the Judiciary, Subcommittee on Immigration, Citizenship, Refugees, Border Security, and International Law, April 26, 2007: Hearing on Proposals for Improving the Electronic Employment Verification and Worksite Enforcement System
Special Report
	Confiscating Contributions Proposals requiring legalized workers to forfeit Social Security credit for their prior work and tax contributions would impoverish future citizens, burden state and local governments, frustrate efforts to correct Social Security records, and undermine immigration reform.
	(Original publication date: May 1, 2007. Republished May 10, 2007, as an Immigrants' Rights Update special report.) By Jonathan Blazer, Public Benefits Policy Attorney, and Josh Bernstein, Director of Federal Policy As Congress prepares to reform the nation’s immigration laws, it will once again consider proposals under which immigrants would forfeit contributions they made to Social Security before obtaining legal status. If enacted, these proposals would set the stage for an enormous social problem in the future when these workers retire — many as U.S. citizens — and find themselves indigent because they lack access to the benefits their taxes were intended to fund. Background Contrary to common perceptions, the majority of undocumented noncitizen workers actually work “on the books” for employers who require that their employees have a Social Security number (SSN). Undocumented people generally cannot obtain a valid “authorized for employment” SSN. Therefore, many must use an invalid SSN if they are to work in the U.S. As a result, they and their employers pay billions of dollars in payroll taxes each year, boosting the Social Security and Medicare trust funds from which everyone benefits.[1] Like any other workers, undocumented workers are both required and encouraged by the federal government to pay payroll and income taxes.[2] According to the U.S. Internal Revenue Service, undocumented noncitizens paid almost $50 billion in federal taxes from 1996 to 2003.[3] Recent reports from across the country indicate that during the 2007 tax season, record numbers of undocumented people filed tax returns.[4] These contributions are a central theme in the debate surrounding comprehensive immigration reform. Rewarding work is a core principle on which earned legalization programs are founded. Yet comprehensive immigration reform proposals have never proposed to afford immigrants the full value of their tax contributions. The proposals contemplate long waiting periods during which many public benefit programs would be unavailable to legalized workers. Until recently, though, Social Security benefits, a universal entitlement based on the actual earnings of those who have paid into the system, were considered in a different light. Before last year, comprehensive immigration reform proposals had not attempted to change current law and disqualify lawfully present and citizen workers of credit for work performed and contributions already made to the Social Security system. [Read more.] [PDF of Special Report] [1] Peter Goss, Social Security’s Chief Actuary, has estimated that three quarters of undocumented immigrants pay payroll taxes. This generates $6 to $7 billion per year in Social Security tax revenue and $1.5 billion in Medicare taxes. See Eduardo Porter, “Illegal Immigrants Are Bolstering Social Security with Billions,” New York Times, April 5, 2005. [2] As IRS Commissioner Mark Everson, a former immigration official, stated in testimony before Congress last year, “If someone is working without authorization in this country, he or she is not absolved of tax liability.” In a more recent speech to the National Press Club, Everson added, “We want your money whether you are here legally or not and whether you earned it legally or not.” Miriam Jordan, “Even Workers in U.S. Illegally Pay Tax Man,” Wall Street Journal, April 4, 2007. [3] Statement of The Honorable Mark W. Everson, Commissioner, Internal Revenue Service, Testimony before the House Committee on Ways and Means, July 26, 2006. [4] See., e.g., Nina Bernstein, “Tax Returns Rise for Immigrants in U.S. Illegally,” New York Times, April 16, 2006.
New on NILC’s Website (since April 25, 2007)
	■ REAL ID Proposed Regulations: Comments Submitted by NILC to Dept. of Homeland Security, May 2, 2007 (Immigrants & Driver’s Licenses page). Re: DHS Docket No. DHS-2006-0030, Regarding “Minimum Standards for Driver’s Licenses and Identification Cards Acceptable by Federal Agencies for Official Purposes” www.nilc.org/immspbs/DLs/real_id_comments_nilc_2007-05-02.pdf ■ Written Statement of Tyler Moran, NILC Employment Policy Director, to the House Committee on the Judiciary, Subcommittee on Immigration, Citizenship, Refugees, Border Security, and International Law, April 26, 2007 (Immigrant Worker Issues in Comprehensive Immigration Reform page). Hearing on: Proposals for Improving the Electronic Employment Verification and Worksite Enforcement System www.nilc.org/immsemplymnt/cir/eevs_testimony_nilc_2007-05-03.pdf