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Do illigals contribute taxes?

PostPosted: Wed Apr 16, 2008 4:15 am
by AAAhmed46
[QUOTE=Lubaolong;22409498]NASHVILLE, Tennessee (AP) -- The tax system collects its due, even from a class of workers with little likelihood of claiming a refund and no hope of drawing a Social Security check.

Martha Pantoja helps Jose Aguilera prepare his income taxes at a community center in Nashville, Tennessee.

Illegal immigrants are paying taxes to Uncle Sam, experts agree. Just how much they pay is hard to determine because the federal government doesn't fully tally it.

But the latest figures available indicate it will amount to billions of dollars in federal income, Social Security and Medicare taxes this year. One rough estimate puts the amount of Social Security taxes alone at around $9 billion per year.

Paycheck withholding collects much of the federal tax from illegal workers, just as it does for legal workers.

The Internal Revenue Service doesn't track a worker's immigration status, yet many illegal immigrants fearful of deportation won't risk the government attention that will come from filing a return even if they might qualify for a refund. Economist William Ford of Middle Tennessee State University says there are no firm figures on how many taxpayers are in that situation.

"The real question is how many of them pay more than they owe. There are undoubtedly hundreds of thousands of people in that situation," Ford said.

But some illegal immigrants choose to file taxes and write a check come April 15, using an alternative to the Social Security number offered by the IRS so it can collect income tax from foreign workers.
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"It's a mistake to think that no illegal immigrants pay taxes. They definitely do," said Martha Pantoja, who has been helping Hispanic immigrants this tax season as an IRS-certified volunteer tax preparer for the nonprofit Nashville Wealth Building Coalition.

Among those she has assisted is Eric Jimenez, a self-employed handyman who has worked in Nashville for several years. He feels obliged to pay taxes -- even though, as Pantoja said, "nothing would happen" to him if he did not.

"I have an idea, a mentality, that to be a good citizen you have to pay taxes," he said. "Also, I'm conscious of the fact that the money we pay in taxes supports the schools and all the public services."

Pantoja said she has helped a number of construction workers who, because they are classified as independent contractors by their employers and have no taxes withheld, owe big tax bills come April. Beyond income tax, they have to pay the full Social Security and Medicare taxes due.

The Social Security Administration estimates that about three-quarters of illegal workers pay taxes that contribute to the overall solvency of Social Security and Medicare.

The agency estimates that for 2005, the last year for which figures are available, about $9 billion in taxes was paid on about $75 billion in wages from people who filed W2 forms with incorrect or mismatched data, which would include illegal immigrants who drew paychecks under fake names and Social Security numbers.

Spokesman Mark Hinkle says Social Security does not know how much of the $9 billion can be attributed to illegal immigrants. The number is certainly not 100 percent, but a significant portion probably comes from taxes paid by illegal immigrants.

Nine billion dollars sounds like a lot of money, and it is, but it is only about 1.5 percent of the total $593 billion paid into Social Security in 2005.

The impact on Social Security is significant, though, because most of that money is never claimed by the people who pay it but instead helps cover retirement checks to legal workers.

Federal law prohibits paying Social Security to illegal immigrants, but the administration factors in both legal and illegal immigration when projecting the trust fund's long-term solvency.

This is especially important as the 78 million-member baby boom generation begins to leave the work force and draw Social Security checks.

"Overall, any type of immigration is a net positive to Social Security. The more people working and paying into the system, the better," Hinkle said. "It does help the system remain solvent."

The Social Security Administration drew from census and Immigration and Customs Enforcement data in 2007 to project the effects of higher and lower immigration patterns.

If net immigration is high at 1.3 million people a year, the SSA's combined trust fund would be exhausted in 2043. But the fund runs out four years earlier if annual net immigration amounts to about half that -- 472,500 legal immigrants and 250,000 illegal immigrants.

The Internal Revenue Service doesn't have an estimate of how many illegal immigrants pay income tax.

But one indicator is the 9 million W-2 forms with mismatched names and Social Security numbers it received in 2004. The IRS said the W-2 forms with invalid Social Security numbers reported about $53 billion in wages and about three-fourths of that, $40 billion in wages, had taxes withheld.

The IRS also has been issuing Individual Taxpayer Identification Numbers, or ITINs, for 12 years to foreigners without a Social Security number. It's believed that many workers who seek the ITINs are in the country illegally, and the IRS reported that there were 2.5 million tax returns filed with an ITIN in 2004.

In 2006, then IRS Commission Mark Everson told Congress that "many illegal aliens, utilizing ITINs, have been reporting tax liability to the tune of almost $50 billion from 1996 to 2003."

An IRS spokesman said more recent figures aren't available.

The Social Security and Medicare taxes from mismatched W2s for the same period was $41.4 billion, Hinkle said.

That adds up to roughly $90 billion in federal taxes during they eight-year period.

The IRS defends the ITIN system, despite criticism that some illegal immigrants have used it to open bank accounts, get mortgages and establish a record of residency and taxpaying they hope might someday lead to legal status.

"The ITIN program is bringing taxpayers into the system," Everson told Congress.

Middle Tennessee State University economics professor William Ford, who has studied taxes and immigration, says a majority of economists agree that illegal immigrants are a net benefit for the U.S. economy.

He said the tax contributions from illegal immigrants, including sales taxes, property taxes and excise taxes (such as the gas tax), are significant.

He calculates that illegal immigrants contributed $428 billion dollars to the nation's $13.6 trillion gross domestic product in 2006. That number assumes illegal immigrants are 30 percent less productive than other workers.

"If anything we need more immigrants coming into the country, not less, especially with the baby boomers retiring," he said.[/QUOTE]

I really don't know what to make of this.

Discuss so i may form an opinion.

PostPosted: Wed Apr 16, 2008 6:29 am
by mhosea
We'll see how it plays out as we go through some tougher economic times and the weakness of the dollar starts to bring lost manufacturing back to life in the US. However, my understanding is that the US economy needs these workers. The real issues are border security and fairness--that however you slice and dice it, after all the changes we make, there will still be about as many warm bodies here from other countries doing about the same things, though maybe not all the same warm bodies. So to me all these other reports about taxes paid and, by the other side of the debate, services used don't seem interesting or relevant. Certainly it is of zero interest to me that an illegal immigrant might be due a tax refund that they can't collect because they don't dare file a tax return. That's just the price of doing business outside the law! No legal immigrant from the same country would have such a difficulty, so that's all about being illegal and nothing about being an immigrant.

PostPosted: Fri Apr 18, 2008 3:01 am
by f.Channell
I have an immigrant friend who's had enough of this economy and is headed home to Italy after over 15 years in the US.

$40.00 to fill my Corolla now.
All the products I sell are going up in price like crazy.
Can't say I blame him.


PostPosted: Fri Apr 18, 2008 2:01 pm
by cxt
Its not a questions if "some" illegals pay taxs---its a question of how many and if the amount coming in is greater than the costs of the services provided.

And depending on what numbers you look at---illegals cost far more than they contribute.

There are also serious economic effects of illegals on a wide range of issues...including artifically depressing wages in many industries...which tends to hurt illegals as well.

PostPosted: Sun Apr 20, 2008 8:43 pm
by IJ
So... the illegals could get higher wages in America if they stayed in Mexico? :lol:

As for the costs, its not as simple as (taxes generated) - (services provided) = cost. They contribute to the economy. Will it really help us all if all illegals were suddenly removed and the apples rotted on the trees, for example?

PostPosted: Mon Apr 21, 2008 2:38 pm
by cxt

Nah, they still get higher wages here---they just don't what they should get..if they were legal. :)

Part of the problem is the situation you describe--the old saw about illegals doing the work that people in the US won't do is largely a fiction----a fiction, in part maintained by the artifically low wages of illegals.

In a very real way illegals hurt legal immigrents first as they compete with the legals for the "work no one but they will do"...if you accept that rational....which in my view is debatable.

Apples might cost more to get them picked by legals etc--but isn't paying a bit more for apples worth the price so that someone can earn a living wage?

Besides---automatiic machines are getting to the point where fewer and fewer crews are needed---not now, but in another 10-15 years my bet is that the need for labor intensive harvesting will be drastically cut.....people need to be planning for that now so their kids won't face future where their labor will be much less needed.

Aw - leave the poor illegal immigrant alone

PostPosted: Mon Apr 21, 2008 3:18 pm
by Mary S
Or did you forget about these good upstanding American citizens....(Catalina Vásquez Villalpando - check your $1 bills - her name may be on them - unbelievable!!!)

Some high profiles

Many tax delinquents live openly and prosperously for years, even decades, while owing millions of dollars in taxes.

Singer Dionne Warwick owes $2.7 million in state taxes, according to the California Franchise Tax Board, which collects the state's income tax. The IRS has placed more than $1 million in tax liens against her for unpaid federal taxes. Public records show that her tax troubles started in 1990 or earlier.

Since then, Warwick has hosted a popular infomercial for the $3.99-per-minute Psychic Friends Network from 1993 through 1998. She maintains a busy recording and concert schedule, including tours this year in Europe and South America. In January, she was robbed of jewelry worth more than $100,000 in a hotel room in Rome. She performed Saturday near Dallas, her website says.

Why is the government unable to collect all taxes due from a five-time Grammy winner generating significant cash flow?

The IRS and the state of California declined to comment, citing privacy rules. Her manager, Henry Carr, said: "I can't talk about it. Very sorry." Warwick did not respond to a letter requesting comment.

Other well-known delinquents:

· Dick Morris --The former political adviser to Bill Clinton is a Fox News analyst. The IRS filed a $1.5 million tax lien against him in 2003. The state of Connecticut reports Morris owes $452,367 in back taxes and penalties.

Morris says he's reached an agreement with Connecticut and his name will be removed from the next delinquency list. He says he is committed to paying his taxes: "Following a difficult period in my life, I fell into arrears. But since then, I have paid almost $3 million in state and federal taxes."

· Sinbad --The comedian and actor -- whose full name is Sinbad Adkins -- owes $2.1 million to the state of California, according to the California Franchise Tax Board. The IRS filed a $416,870 tax lien against him in 2006. Other tax liens against him date to 1994, when he starred in The Sinbad Show on the Fox Network. His recent gigs include performing at last year's Wal-Mart shareholders meeting and Saturday at the Hilton Casino in Atlantic City. Sinbad declined to comment.

· Catalina Vásquez Villalpando --The former treasurer of the United States -- her signature appears on paper currency printed during the administration of the first President Bush -- owes $168,000 in taxes to Washington, D.C., the city reports. She was convicted of tax evasion in 1994 for hiding income while in office and served four months in prison. She did not respond to a request for comment.

· O.J. Simpson --The ex-football star, who lives in Florida, owes $1.5 million in California taxes, the state says. Yale Galanter, an attorney for Simpson, says he hasn't been notified of the debt. "Nobody has ever contacted me from the state of California," his attorney, Yale Galanter told The Associated Press. He says Simpson owns no property or assets there.

(USA Today article on tax evasion)

PostPosted: Tue Apr 22, 2008 5:45 am
by IJ
"Part of the problem is the situation you describe--the old saw about illegals doing the work that people in the US won't do is largely a fiction----a fiction, in part maintained by the artifically low wages of illegals."

Can we.... substantiate this? If you're saying americans would do the work, just at higher prices, that's really not that different. Heck I'd pick fruit for a million bucks. Doesn't mean any of us would have any fruit if that were the going rate. Point is, people like their cheap fruit and their cheap lawncare and construction and clothes and so on. Same reason we're giving our country to China via of walmart.

PostPosted: Wed Apr 23, 2008 1:39 am
by cxt

I get your point---my point is that if wages were set by the market rather than artifically depressed by the use of illegal labor---then we would all be paying more---but that would not be a on-banc bad thing....IMO.

And yes, there are few jobs "americans won't do"---we did most them prior to cheap labor--legal of otherwise.
Its just a question of people willing to work for a fair wage.

The sad part is that its largely a moot point as far as farm labor goes its all getting automated at a pretty quick pace--sooner or later those jobs will be nearly gone.

PostPosted: Thu Apr 24, 2008 12:15 am
by IJ
"...if wages were set by the market rather than artifically depressed by the use of illegal labor...."

Aside from the fact that wages are depressed a little by the lack of power of illegals in complaining, and the minimal loss of taxation (people in their bracket wouldn't pay much anyway), illegal immigration IS the free market. You could stand your argument on its head and say that entitled americans who want benefits and health care and good income to do manual labor and use unions and minimum wage laws to prop up wages are the artificial side of wages and people who come here illegally and do the job for cheaper represent an unfettered market.

What's "artificial" about a guatemalan fruit picker? Are they sweetened with saccharin or something?

PostPosted: Thu Apr 24, 2008 5:37 pm
by cxt

What is "artifical" is that illegals are often taken advantage of by employers who know they don't have to pay them a fair wage...think of Wal Mart with less regard for wokers well being. ;)

They have few options and no-one to really file a complaint with.

The market isn't wholly "free" you know---its more of a balancing act...which is why you can't simply do as you please with the people you treat.....which I should not have to explain.

Its why your argument is not correct--on a number of levels...but the fact they are illegal to start with is part of the problem....if a company was dumping toxic waste into the river instead of paying to have it treated--an dthus saving a ton of cash is ALSO illegal.
Breaking the law to give oneself a competitive advantage is problem.

On the illegal side---they eventually will become legal--which means that in order to keep prices down you keep haveing to bring more illegals in......or you create a permenent underclass.

But you are correct on the otherside--labor unions which once had a serious purpose are often the cause of their own problems these days........a union which makes it nearly impossible to compete will essentially put itself out of business...which a number of them nearly have.

PostPosted: Thu Apr 24, 2008 11:24 pm
by IJ
"What is "artifical" is that illegals are often taken advantage of by employers who know they don't have to pay them a fair wage...think of Wal Mart with less regard for wokers well being. They have few options and no-one to really file a complaint with."

I think you've perhaps missed my point. I didn't say they were well treated--I said they represent the free market. When you aren't paid what you're worth in a free market, you don't file a complaint, you take another job. You take the best one you can find. If you're hot stuff, then employers compete for you and your wage goes up. Otherwise it stays low and you compete with other unskilled workers for the jobs. That's the market. It ain't pretty. But it's the market. So do you want it or not?

It seems that people raise these issues to "protect" the illegal worker. We don't want to see them abused, underpaid... so we have to keep them out! That's paternalistic. The illegal workers decided that America was the place to be. they can make more here illegally than they can at home, legally. They can meet their needs and send money back to relatives in many cases. They're better off here and so they choose it. That's the market speaking. Don't send any migrants home "for their own good," because that doesn't make sense. If you want to do the super honorable thing, then you keep them here and improve their conditions. That can mean worker passes or legalization but it will reduce the nice feature that they're cheap--so there may always be illegal working on the side. that doesn't surprise me living right next to the border with the greatest wealth disparity anywhere in the known galaxy.

"Breaking the law to give oneself a competitive advantage is [a] problem."

That's one way to say it. I would say instead that breaking the law is a crime. That's never been in dispute. But this is like drugs. Americans want drugs and cheap labor. If you make them illegal, they will break the law and get them. Cause and effect. Interdiction will fail.

"On the illegal side---they eventually will become legal--which means that in order to keep prices down you keep haveing to bring more illegals in......or you create a permenent underclass."

Well, to your two points, it's not exactly a secret that America is a land of continuous (at times forced) immigration. Who do you think picked that cotton and built those railroads and those NYC skyscrapers, the Puritans? (Perhaps I should have said, the native americans?). Yeah, people immigrate to do the work. We're also an enormous braindrain, taking not just illegal laborers from Mexico, but the best educated from Africa, India, and underdeveloped parts of Asia. From the looks of my hospital wards, we've taken every nurse the Phillipines ever trained.

Also, we have a huge class divide with the less educated poor on one hand and the wealthy and educated controlling the country on the other hand. That's not a secret either and it's not our most charming feature. While it doesn't always appeal to our egalitarianism, certainly, the free market made us a superpower--just ask the Russians.

PostPosted: Fri Apr 25, 2008 1:13 am
by cxt

Again, its not "really" a utterly "free market" there are rules and regulations that are often there for good reasons----reason that protect the that illegals lack...and unfair advatages that accrueto those that illegally employ them.

Key words here are "legal", "illegal" and "free"---your not suggesting that we simple throw out any regulation what-so-ever are you. ;)
Wal Mart would so looooovvvveeee that.

I also notice that you seem "illegal" with "immigrent"---oddly juxtapostion since legal immgriments are the often the folks that are hurt first by illegals.

I'm all for a fair immigration policy---I simply object to ILLEGAL immigration.

And its IS to "protect" least in part....refusal to accpet that their illegal status allows...even encourges abuse.

Drugs? Maybe---it would be vastly harder to use illegal labor--and there are steps that could make it even harder.

Sure Americans want "cheap labor"---but they don't by and large want illegal labor---nor is it evidence that the should get it just because they what it...again, that is exactly why we have labor regulations in the first place.

So why are you...being such a fan of the "free market" irked about the USA being a "braindrain???"
Surely people can chose to legally imigrate and make their own chocies about where they choose to work?
As you have framed prior the free market is simply something that we must deal with when it comes to illegals---BUT something to object to when it comes to medical personal and smart people.....not sure that you can have it both ways here.

IMO there is little relevent about pointing to the past on this issue.......things change and 100 year old policies and approachs are not much use these days.....and they were highly questionable at the time.

Education is open to almost everyone in the USA...almost.

I'd also argue that there is a serious difference between "educated" and what I would term smart---there seem to be a staggeringly large number of supposedly well educated people makeing seriously mistaken judgements of late----on both sides of the political fence. :(.....mores the pity.

Lets not forget that GWB is a Harvard grad with better grades than Kerry or Gore. :oops:

PostPosted: Fri Apr 25, 2008 4:49 pm
by IJ
"Again, its not "really" a utterly "free market" there are rules and regulations..."

Yes, I'm well aware, and pointed some out. My point was that people who frequently raise market concerns WRT illegal immigration have failed to notice that illegals are breaking rules to participate in a free market.

"And its IS to "protect" least in part....refusal to accpet that their illegal status allows...even encourges abuse."

Well, I hope you read my post. The people in question, reasoning, functional humans all, made a decision that this "abuse" is better than their options outside of the USA or waiting for legal immigration. So we ought not to pretend that we're trying to serve their interest by barring them from the states. If it were their interest we served, we probably wouldn't need to catch them and forcibly deport them. Oppose illegal immigrants for other reasons, but dumping them back into a worse life isn't doing them a favor.

"Sure Americans want "cheap labor"---but they don't by and large want illegal labor."

Really? Then the market for illegals will dry up later this week. Just like the one for chinese goods.

"IMO there is little relevent about pointing to the past on this issue.......things change and 100 year old policies and approachs are not much use these days.....and they were highly questionable at the time."

So you're saying there's no reason to consider the fact that the nation has had a varying but constant supply of cheap foreign labor over the decades? Maybe it would be irrelevant to point out that many of the immigration concerns (crime, cultural dilution, etc) were raised about these other groups which are now well integrated into the nation?

PostPosted: Fri Apr 25, 2008 6:34 pm
by cxt
But again, IJ--its not real utterly "free" market--and as you pointed out they are breaking the rules--rules set up for everyones protection...including the illegals.

I honestly don't mean to upset you--but I find the whole "they made the decsion that abuse is better than thier options" suspect---its still not right to abuse them IMO, just because they personally are used to and accepet abuse is no reason to simply blow it off---despite the advantages to busienss to do so.

(although business that employ illegals would love to use that arguement I suspect)

"Dumping them back to a worse life"

Well, that is not really my problem..its theirs, AGAIN, I have no problem with fair and legal immigration--have many problems with ILLEGAL immigration.
But short of turning the whole planet into the USA, places elsewhere are ALWAYS going to be worse...we don't have room for the whole planet here...and we keep getting accused of "cultural imperialism" when we try to make things better elsewhere...classic Catch 22.

Things are often rough for alot of people-----but I doubt you would be cool with it if I broke into your place and squatted there for awhile if I lost my job, the mob was after me and I needed medical help.
In the abstract we can show a ton of the concrete however---we all draw pretty firm lines....all of us.

Nope, most people don't employ illegals, and those that do will dry up when the laws are better enforced.,,,start sending employers to jail for example. ;)

Interesting you mention China--perfect example that if given a chance a business will often break the matter whom gets hurt.
I'd say that its a real reason why such rules exsist and the harms that can result if business are allowed to flaunt them.

No, I'm saying that essentially arguing that 100-200 years ago we imported a lot of people is no longer relevent to decsion making today---after all you use up-to-date treatment methods in your job don't you?
You don't look at 150 year old pharma text to decide what drugs and amount, drug interactions etc to give people right? ;)

And those folks BTW were LEGAL...big difference.