Undocumented immigrants granted amnesty and Social Security numbers under President Obama’s executive actions will be eligible for tax benefits on the years in which they were working U.S. illegally, IRS Commissioner John Koskinen confirms.
Koskinen offered details of the apparent loophole during a during a Senate Finance Committee hearing this week.
“Mr. Commissioner, can you confirm that those granted deferred action will be eligible to benefit from the [Earned Income Tax Credit] for years in which they were working without papers in the United States once they obtained a — once they obtain a Social Security number?” Sen. Chuck Grassley (R-IA) pressed Koskinen at the hearing Tuesday.
Koskinen replied in the affirmative, explaining that illegal immigrants or those without a Social Security number are not allowed to claim EITC benefits, however if they filed tax returns in the past they could retroactively claim the benefits once they obtain a Social Security number.
“Then the program allows you to file for an earned income tax credit program, in terms of whether you can do that retroactively, the normal statutes of limitations would apply as to when you can apply, file an amended return, in effect,” he said.
Grassley expressed frustration that the IRS’ policy appears to contradict congressional intent, which aims to not reward law breakers.
“This is a problem you get into,” Grassley said. “The IRS has an interpretation of the EITC eligibility requirements undermines congressional policy of not rewarding those for working illegally in the United States.”
The Iowa lawmaker went on to ask if the IRS expects to revisit the policy interpretation, given Obama’s executive amnesty.
“At this point, I’m not aware that we’re going to do that, but I’d be happy to get back to you,” Koskinen replied.