THIEVES AND ACCOMPLICES
Reporter Bob Segall of NBC affiliate WTHR in Indianapolis, Indiana, aired an investigative report on April 26, 2012, explaining that hundreds of thousands of illegal immigrants were fraudulently obtaining the Additional Child Tax Credit, listing as relatives people who actually lived outside the United States, south of the border. Some $4.2 billion per year in U.S. tax dollars are going to illegals as refunds under this credit. Claimants can receive up to $1,000 per child listed. In Segall’s report, a tax preparer whose identity was masked explained, “we’ve seen sometimes 10 or 12 dependents, most times nieces and nephews, on these tax forms. The more you put on there, the more you get back.”
On the anniversary of Segall’s report, which went viral a year ago, illegals are still obtaining the credit fraudulently. A bill has passed the House to stop the fraud, but Senator Harry Reid refuses to let it come to a vote in the Senate and all but a few Senate Democrats stand with him opposing the measure. The Internal Revenue Service takes the position that it is powerless to end disbursements of the billions in tax dollars given illegals because “current law entitles them to receive it.” The IRS is not undertaking a major investigation to uncover the fraud and penalize the perpetrators, who frequently list people as relatives who are either not actual relations or do not live with them in the United States (but reside south of the border). Segall interviewed U.S. Treasury Department Inspector General for Tax Administration Russell George who said that “millions of people are seeking this tax credit who . . . are not entitled to it” and, despite recommendations from him to the IRS, the agency has “not taken sufficient action . . . to solve the problem.”
In Inspector General George’s report, he explains that “[t]he payment of federal funds through this tax benefit appears to provide an additional incentive for aliens to enter, reside and work in the United States without authorization, which contradicts federal law and policy to remove such incentives.”
Illegal immigrants are required to file tax returns. Returns must be filed even if they report no taxable money earned. Even if they report only $3,000 in annual income, they are eligible for the Additional Child Tax Credit. To enable illegals to file returns, the IRS has created an Individual Taxpayer Identification Number (ITIN) which they use in lieu of a social security number. An illegal who reports no taxable income on a tax return can nevertheless recoup from the IRS tens of thousands of dollars for claimed refunds under the Additional Child Tax Credit. Literally any amount can come to them simply by listing people as nieces and nephews. Some have received over $9,000 from the IRS. A few have received as much as $40,000 or more. The children are supposed to be under 17 and to be either U.S. citizens, U.S. nationals, or U.S. resident aliens. The IRS appears not to do any serious investigation to ensure compliance with the law before dispensing funds, and the amount of money pouring out of tax coffers to illegal immigrants continues to skyrocket.
Neither the IRS nor the Administration nor Congress has stopped this massive fraud. Inspector General George’s report urged IRS to require individuals filing with ITINs and claiming the Additional Child Tax Credit to provide specific verifiable documentation to support that their dependents met each of the qualifications for the credit, including residency. He wanted the IRS to flag questionable Child Tax Credit and Additional Child Tax Credit claims on ITIN returns and investigate every one before refunds were distributed. Once refunds leave the IRS there is little, if any, realistic hope of IRS recouping the money.
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Several iterations of the child tax credit have followed legislative attempts to enhance use of the credit to provide greater economic stimulus. Those moves have expanded the program in ways abused by illegals. Because the Hispanic vote overwhelmingly favors Democrats, the abuses are ignored by the Administration and Senate Majority, which, in effect, benefits from an Administration hand-out extended to Hispanic illegals. The best immediate solution to this problem is to end the ITIN for use in obtaining the Additional Child Tax Credit (to limit the credit to those with a social security number). While theft of social security numbers also results in fraud, reliance on the social security number would dramatically reduce the billions now fraudulently bilked from American taxpayers while the Obama Administration and Senate Democrats conveniently ignore the fraud, thereby becoming accomplices to it.
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