By Alicia Atteberry
As U.S. Supreme Court Justice Oliver Wendell Holmes said: “I like paying taxes. With them, I buy civilization.” Immigrants, including the undocumented, are a vital part of our civilization. Despite the unpleasant rhetoric and widespread misconceptions, undocumented immigrants in the United States pay billions of dollars in federal, state, and local taxes each year, helping to pay for services they are largely unable to access. When sales tax, property tax, and income tax are combined, they contribute greatly to our state and federal governments and to the economy as a whole.
I am an undocumented immigrant, what do I need to know about filing my taxes?
It is tax season, and the filing deadline is fast approaching: in 2024, taxes are due on April 15. Taxes help build and maintain roads, educate children, and keep our local, state, and federal governments running. Still, all of that can be hard to appreciate when it is time to deal with complicated paperwork or take money out of a tight budget to pay an accountant or a service to help you. Filing taxes can be stressful for everyone, but if you are an undocumented immigrant, it can be especially intimidating. Without legal status, it is understandable that sending a form to the government to inform officials where you live and work might seem like a bad idea. Let's look at all the reasons why that is not true.
Won't I get into trouble with the government?
- In fact, you are more likely to get into trouble for NOT filing your taxes. Tax evasion is a crime!
- He will not be reported, much less deported, simply for filing and paying their taxes. The Internal Revenue Service (IRS) is a separate government entity from USCIS or Homeland Security. Its priority is collecting taxes, and it is in the IRS's best interest to value taxpayer privacy and continue collecting the millions of dollars in income taxes from undocumented immigrants.
- Under the Internal Revenue Code, the body of laws governing the federal tax system, even an undocumented person living primarily in the United States will treated for tax purposes as a United States resident. They are included in the term “resident aliens” in the IRS guide.
- The Internal Revenue Code specifically states that the IRS can only provide taxpayer information internally or to the US Treasury to assist in the investigation of tax-related crimes, unless the agency receives a federal court order. The IRS is strict about following this guideline. No immigration-related investigation would be triggered by a tax return.
Why do I need to submit the application?
- All wage earners in the United States, Even undocumented immigrants are required to file taxes. if they meet the income thresholds. The details of what those thresholds are can be complicated and are updated regularly, but they essentially depend on who employs you and whether or not you are married. Currently, regular employment—which generally issues a W-2—requires you to file taxes if you earn more than $13,850 and are single, or $27,700 if you file a joint return with a spouse. For self-employment income, the threshold is just $400. You may receive a Form 1099 for this type of income if you work as a contractor—for example, with a company like Uber or DoorDash—but even if you’re paid entirely in cash “under the table,” this rule still applies to you.
- If you receive paychecks with taxes automatically deducted and then never file your taxes, that means even if You're due a refund, the money goes to the IRS. That's your money, and you can only get it back by filing your taxes.
- In many cases, your legal status application will benefit to prove that you have been paying taxes. It is a legal requirement of the IRS that all wage earners in the United States, regardless of their immigration status, pay taxes. Doing so helps demonstrate that you are of “good moral character,” a requirement when applying to adjust your status. If you are already paying taxes, that goes a long way toward demonstrating that you will be a law-abiding citizen.
Where do I start?
- The first step in filing taxes if you are not eligible for a Social Security number is to apply for an ITIN, a Personal Taxpayer Identification Number. This is the number the IRS uses to track tax payments instead of a Social Security number. It is used largely by undocumented immigrants and does not provide any immigration status or benefits. It is used only for taxes.
- For apply for an ITIN, you must complete Form W-7 and provide proof of identity and foreign status. Both requirements may be met with a valid passport from your country of origin; otherwise, several documents will be required, such as a U.S. state ID card and a foreign birth certificate. You will then prepare your taxes and file Form W-7 along with them.
- If you haven't been filing your taxes, the IRS allows you to file back taxes from previous years and/or amend tax returns that were filed incorrectly.
More things to keep in mind
- The IRS itself provides many resources to help present their taxes without having to pay for tax preparation. Recently, they also began providing forms and official guidance in foreign languages, including the basic filing form, Form 1040, in Spanish!
- That's a good idea seek professional help when filing your taxes, especially if this is your first time going through the process. There are many popular online services available, or a quick Internet search could help you find a local accountant.
- There are also many services and organizations in the United States that provide Free tax services for low-income taxpayers and/or taxpayers with limited English proficiency. One example is the nonprofit organization BakerRipley Neighborhood Tax Centers in Houston, Texas, where volunteers help hundreds of thousands of people each year file their taxes for free.
- Without a Social Security number, many tax exemptions and benefits are not available to undocumented immigrants. However, some are available, such as the American Opportunity Tax Credit, the Child Tax Credit (if your child has a Social Security number), and the Lifetime Learning Credit. These credits help you pay for childcare and education expenses.
- If you're self-employed or a contractor, it's a good idea to calculate your taxes in advance and estimated tax payments . Otherwise, you'll end up with a huge tax bill at the end of the year and may have to pay penalties.
- If you want to file your taxes this year and haven't started the process yet, it's not too late! You can file for a tax extension with the IRS, and you can even do so before applying for an ITIN.
In Eagan, we review each client’s recent tax history and provide guidance on how to correct any issues with their tax returns. Unfortunately, if taxes have not been filed or have been filed incorrectly, this can sometimes slow down the process of applying for immigration benefits.
If you plan to apply for status soon, no matter how you apply, it is a good idea to get your taxes in order as best you can.
Call us at 202-709-6439 o click here for a consultation directly with attorney Lauren Eagan.
This information is for educational purposes only and does not constitute legal advice.