Source: https://cis.org/Ting/IRS-Ignores-Appeals-Court-Decision-Continues-Paying-Child-Tax-Credits-Illegal-Aliens
Timestamp: 2019-04-22 08:44:42+00:00

Document:
In light of a decision by a U.S. Court of Appeals that the child tax credit is a "public assistance benefit", it should be hard if not impossible for the IRS to justify continuation of its implicit position that the credit is not a "public benefit". Nevertheless, the likelihood that the IRS will abide by the appellate court's decision must be weighed against its self-evident determination to frustrate the intent of Congress, as expressed in the PRWOA, to "remove the incentive for illegal immigration provided by the availability of public benefits."
Unlike a claimant of the earned income tax credit, a taxpayer claiming the child tax credit need not have a Social Security number. However, the credit must be claimed on a federal income tax return, and the filer of any such return must have an "identifying number".14 The "identifying number" is the taxpayer's SSN, if he has one,15 and any alien residing and working lawfully in the United States should have an SSN.
The natural reading of that regulation is that the IRS may issue ITINs to aliens who spend too much time in the United States to qualify as "nonresident" but may nevertheless need an "identifying number" in order to file a U.S. tax return. However, as noted in the aforementioned reports of the Treasury Department Inspector General, the IRS has adopted a "don't ask, don't tell" policy of issuing ITINs to millions of aliens who reside in the United States, who would normally use an SSN as their "identifying number", but who cannot get an SSN because their U.S. residence is unlawful. Although it appears that the IRS "may" do this under the applicable Treasury Regulations, they are by no means obligated to do so, and by doing so they undermine the intent of Congress in PRWOA "to remove the incentive for illegal immigration provided by the availability of public benefits." The Treasury Department is of course free to amend its regulations to remove the loophole through which the IRS has poured billions of dollars into the hands of immigration lawbreakers.
1 "Actions Are Needed to Ensure Proper Use of Individual Taxpayer Identification Numbers and to Verify or Limit Refundable Credit Claims", Reference Number 2009-40-057, Treasury Inspector General for Tax Administration, March 31, 2009; "Individual Taxpayer Identification Numbers Are Being Issued Without Sufficient Supporting Documentation", Reference Number: 2010-40-005, Treasury Inspector General for Tax Administration, December 8, 2009.
2 8 U.S.C. § 24(a).
3 8. U.S.C. § 24 (b), (d). See also I.R.S. Publication 972: "Additional Child Tax Credit", 2016.
4 8 U.S.C. § 1611(a) (emphasis supplied).
5 8 U.S.C. § 1601.
6 8 U.S.C. § 1611(c)(1)(B).
7 Erika K. Lunder, "Legal Authority for Aliens to Claim Refundable Tax Credits: In Brief", Congressional Research Service, December 1, 2015.
9 See, e.g., In re Jones, 107 B.R. 751 (Bankr. D. Id. 1989).
10 See, e.g., In re Beltz, 263 B.R. 525 (Bankr. W.D. Ky. 2001).
11 Congressional Research Service, supra, at 7.
12 In re Pepper Minthia Hardy, 787 F. 3d 1189 (2015).
13 787 F. 3d at 1194.
14 8 U.S.C. § 6109(a).
15 8 U.S.C. § 6109(d).
16 8 U.S.C. § 6109(h).
17 26 C.F.R. § 1.6109(g)(1)(iii).

References: § 24
 § 24
 § 1611
 § 1601
 § 1611
 § 6109
 § 6109
 § 6109
 § 1