Illegal Immigrants Get $10.5 Billion from Child Tax Credit in Reconciliation; More than Previously Estimated
Illegals with both U.S.-born & illegal immigrant children will benefit, as will recent border-crossers
By Steven A. Camarota on November 9, 2021
In an October analysis, we estimated that illegal immigrants would receive $8.2 billion in cash payments from the expanded Child Tax Credit (CTC), which is part of budget reconciliation bill, also referred to as the Build Back Better (BBB) Act. That analysis assumed cash payments would be limited to illegal immigrants with U.S.-born children, as is the case with the Additional Child Tax Credit (ACTC) it replaces. But the current version of the BBB Act repeals p. 1,452, line 14, the requirement that children claimed as dependents need Social Security numbers (SSNs). As a result, illegal immigrants whose children are illegal immigrants as well will receive an estimated $1.5 billion in payments from the new program. The elimination of the SSN requirement also allows the more than 600,000 illegal immigrants encountered at the border in family units or as unaccompanied minors and released in FY 2021 to receive cash payments from the new CTC. We roughly estimate these new arrivals will receive slightly less than $800 million from the program, for a total of $10.5 billion in cash payments to illegal immigrants here in 2020 or released into the country in FY 2021. Receipt of payments under the new CTC is made all the easier because the BBB eliminates the work requirement of the old ACTC.1
Like the ACTC, the new CTC pays cash to lower-income families who do not pay any federal income tax. The new program significantly increases the maximum cash payment, which is referred to as a “refundable credit”, from $1,400 per child under the old ACTC to $3,600 for children under six, and $3,000 for children six to 17. The new CTC is only extended for one year in the BBB, after which the maximum for all children would be $2,000. While the elimination of the Social Security requirement is permanent, the dropping of the work requirement is only extended through tax year 2022. The elimination of the work requirement seems designed to facilitate illegal aliens’ receipt of payments. Some illegal aliens who work off the books have trouble demonstrating employment income, so dropping the work requirement makes it easier for them to now receive cash payments. Proponents almost certainly hope that the fully expanded credit, presumably without a work requirement, will be made permanent if it proves popular.
For parents to receive cash payments from the old ACTC their child needed a valid SSN. As we explained in our earlier study, if the parents do not have an SSN themselves, they can still receive payments from the credit if get an Individual Taxpayer Identification Number, which is not difficult. In practice, this meant that only illegal immigrants with U.S.-born children could receive payments, as all children born in the United States are issued SSNs. By eliminating the SSN requirement, the new credit allows illegal immigrants whose children are also in the country illegally to receive payments.
https://cis.org/Camarota/Illegal-Immigrants-Get-105-Billion-Child-Tax-Credit-Reconciliation-More-Previously
