Illegal aliens getting billions from the IRS in tax refunds

It isn’t bad enough that the federal government doesn’t secure the American border, there is a tax loophole that allows illegal aliens and other nonresidents in the United States to get large tax refunds costing the American people billions of dollars!


Each spring, at tax preparation offices all across the nation, many illegal immigrants are now eagerly filing tax returns to take advantage of a tax loophole, using their ITIN (Individual Taxpayer Identification Numbers) to get huge refunds from the IRS.

The loophole is called the Additional Child Tax Credit. It’s a fully-refundable credit of up to $1000 per child, and it’s meant to help working families who have children living at home.  

But 13 Investigates has found many undocumented workers are claiming the tax credit for kids who live in Mexico – lots of kids in Mexico.

“We’ve seen sometimes 10 or 12 dependents, most times nieces and nephews, on these tax forms,” the whistleblower told Eyewitness News. “The more you put on there, the more you get back.”

“Here’s a return right here: we’ve got a $10,3000 refund for nine nieces and nephews,” he said, pointing to the words “niece” and “nephew” listed on the tax forms nine separate times.

The problem is increasing arithmetically. In 2009, ITIN tax filers received about $1B dollars in additional child tax credits, but last year the illegal alien tax credit cost the American taxpayers $4.2B dollars.

One of the Indiana workers said four other illegal aliens used his home address and claimed 20 children lived in the home. The IRS sent them tax refunds of $29,608. Only one child was observed living at that address and the illegal alien even admitted off camera that the remaining children lived in Mexico!

He later explained that not only did the kids not live at the residence but have never even visited the United States. When asked how one would receive tax credits in violation of the IRS rules, the worker said, “If the opportunity is there and they can give it to me, why not take advantage of it?”



  1. JRM_CommonSense

    That is not a tax loophole. It is people filing fraudulent tax returns. The deduction you are speaking about requires that the “dependent” lives in the home of the person claiming them for a half year as a minimum. If that is not true, then these tax returns need to be turned over to the IRS with proof that it is not true. If the organization that you are referring to does not do that, they are accessories to tax fraud and subject to prosecution.

    Every single tax deduction that exists can be exploited by people filing fraudulent tax returns. To try to pass that fraud off as a loophole in the tax code is slightly disengenuous. There are probably many more “citizens” committing this type of fraud than illegal aliens doing it. What does that say about your failure and the failure of the original reporters making that point?

    • Ted Biondo

      JRM – the IRS has been told about the “FRAUD” – they have chose to do nothing. Didn’t you read the article part 1 and 2?

  2. Milton Waddams

    That isn’t a loophole. A loophole is violating the spirit of the law, but this violates the letter of the law. That’s flat out tax fraud. The filers and preparation places should be charged with tax fraud.

    From the IRS:

    Citizenship Test – To meet the citizenship test, the child must be a U.S. citizen, U.S. national, or U.S. resident alien.

    • Ted Biondo

      You are absolutely right Milton – fraud because they children must be U.S. citizens or resident aliens – but who checks that anymore? It’s not the IRS’s money it’s ours, so do they do their job – hell no – they are bureaucrats!

  3. SNuss

    Just remember: This is the same bunch of bureaucrats that will enforce ObamaCare laws.

    • Ted Biondo

      Right on SNuss about the same bunch of bureaucrats – they are already making noises, as anyone with common sense will admit, that the health care rationing will start with obese people. Now when you go off your diet, you will be unpatriotic!

  4. Juice

    Rememeber, these people will spend the money right away, which will stimulate the economy, and create jobs, blah, blah, blah.How’s that working out for you about to lose your unemployment? The illegals will never lose their gov’t pay. Just keep voting democrat.

  5. A refundable tax credit for illegal aliens is a loophole and I dont care if the kids live with them or in mexico.

    P.S. Illegal aliens can not use the ITIN to work, they use a social security number and it may be yours.

    • Ted Biondo

      Correct about the social security numbers, Sam – but you knew that, right?

  6. JRM_CommonSense

    Hey SNuss and Juice, why don’t you guys take advantage of that “tax loophole” by doing the same thing these guys are doing. The tax laws regarding the Additional Child Tax Credit applies to U.S. citizens as well as illegal aliens. You guys and every American citizen could be making a killing.

  7. SNuss

    Because WE ABIDE BY THE LAWS, unlike some Leftists who think laws are optional.

    • Ted Biondo

      SNuss, they think not only think laws are optional, they think all the money you earn is their’s until the government decides what it will let you keep – just to be fair.

  8. SNuss

    BTW, it is considered racist (by the Looney Left) to call them “Illegal aliens”.
    In the future, please refer to them as “undocumented Democrats”.

  9. Carol Foster

    You’ve just got to love that bit about because “WE ABIDE BY THE LAWS.”
    Who exactly are the “WE?”
    Guess there’s never been a Conservative tax cheater in all of America’s history?

    • Ted Biondo

      Carol – at least conservatives I know don’t get appointed to the President’s cabinet such as Tim Geithner, Treasury Secretary!! Obama considers those who don’t pay their taxes as people with experience that can catch other lawbreakers, I guess?

  10. JRM_CommonSense

    So SNuss, you do agree that this is a tax fraud situation, not the “government” giving illegal aliens a tax loophole. It sure didn’t sound that way the first time you brought up exactly the same thing that Ted is now writing about using exactly the same quotes and references. That was on April 28th in Ted’s other posting on “Don’t we give up freedom for government’s help”.

    If you can all them illegal aliens, as you have in many posts, and Ted can call them illegal aliens as he has in many of his posts, then I can call them illegal aliens as well. But I notice that neither you, Ted, or the sommentor that you both quoted made any mention of the number of non-illegal American Citizens that are probably committing the same tax fraud on this same issue.

    And thank you for continuing to demonstrate you uncanny ability to use at least one of the words leftist, looney, liberal, or several of these in almost every posting you make. I know it gives me a good laugh every day, and I am sure others find it funny as well.

    • Ted Biondo

      JRM – The government doesn’t seem to be doing anything about the problem, even if that was not their original intent. So in this regard, the government is “letting” illegals get away with stealing $4B dollars of U. S. citizens money!

  11. SNuss

    Just remember: Those “Illegal aliens” have had to break other laws, in order to live and work here. They are criminals, no more, and no less.

    El inmigrantes-usted legal está muy bienvenido!
    ¡Ilegal — regresa a casa, y entra la línea!

  12. SNuss

    BTW, Carol, I don’t believe Republicans have ever named a KNOWN TAX CHEAT to run the IRS.

  13. Y.Yossarian

    I agree with the fundamental points you make regarding tax fraud and apparent government indifference. If it can be proven, such fraud should be prosecuted. But, you could more effectively make our conservative case by staying above the fray. You complained in a recent post about the poor math skills taught in schools these days. Apparently the grammar skills taught in your day were just as bad. You could improve on siting your cites in your posts and please look up segue and segway. And lose the ad hominem attacks on those that post to you commentaries. it is unprofessional and undignified. You choose to provide commentary in a public forum and your conservative points would be better served without the petty name calling.

  14. Carol Foster

    In the previous Administration, someone very high up went to jail. Former President Nixon had to resign from office to avoid impeachment proceedings. The list could go on and on for both political party’s persons so stop pretending as if you have clean hands.
    I’m not sure how many Americans disgree with their tax bills and have problems with the IRS, but they all don’t have jobs at the White House. And according to our laws you may disagree with what the government says you owe and not pay your taxes until the matter is concluded, which can also mean making payments with interest.
    As for why the IRS goes after some taxpayers and not others isn’t a matter of politics unless you want to go back to the Nixon era. They are one of the government agencies whose staff has been cut over the years, and like medicare fraud, haven’t the manpower. If you get that smaller govenment you’ll get more fraud, as no matter the tax system you plan to impose, it will be fertile ground for fraud.

  15. SNuss

    Carol, in those cases, people were removed AFTER committing their offenses.
    “Turbo-Tax” Timmy knew that he had cheated the Federal government out of thousands of dollars, and only paid it back in order to get appointed to run the part of the government that is supposed to find and prosecute tax cheats. Don’t you find that just a bit odd? Hypocritical, perhaps?

  16. JRM_CommonSense

    Ted, I have read the article several times. I have extracted the quotes and listed them below.

    “The whistleblower has thousands of examples, and he brought some of them to 13 Investigates. While identifying information such as names and addresses on the tax returns was redacted, it was still clear that the tax filers had received large tax refunds after claiming additional child tax credits for many dependents.”

    “Last year, our whistleblower noticed dozens of undocumented workers had used phony documents and false income to claim tax credits. He reported all of it to the IRS.”

    Russell George, the United States Department of Treasury’s Inspector General for Tax Administration (TIGTA). “has repeatedly warned the IRS that additional child tax credits are being abused by undocumented workers. In 2009, his office released an audit report that showed ITIN tax filers received about $1 billion in additional child tax credits. Last year, the inspector general released a new report showing the problem now costs American tax payers more than $4.2 billion.”

    My concerns:

    1. The “whistleblower” “has thousands of examples” but only reported information about “dozens of undocumented workers” to the IRS. Did the “whistleblower” report it using copies of the actual tax forms for the offenders, including their names, addresses, and identification numbers? If not, the IRS does not have actual cases to chase. Why, if the “whistleblower had thousands of examples, did he/she only report “dozens” to the IRS?
    2. If the Inspector General had all of the information on the abuses by undocumented workers, why did they not supply all of the names, addresses, and identifications numbers to the IRS instead of just repeatedly warning them of the abuses. With out specific information how does the IRS act? It seems that the Inspector General’s suggestion was that the IRS ask for more documentation of the claims. The IRS cannot change Tax Law. That is the Legislative Branches job.
    3. I am not saying that abuses have not happened. I am sure that they have. But the implications in the “whistleblower” story are that it is only Mexican illegal aliens and no other illegal aliens or U.S. citizens committing this fraud; and it is every single Mexican illegal alien that are committing this fraud not just some of them.
    4. The implications being made in referencing the Inspector General’s finding are that all illegal aliens are committing fraud and that the result of that is a loss to this fraud of $4.2 billion. However, when you read the Inspector General’s complete statements you see that he is saying that the total dollar value paid to illegal aliens claiming this tax credit is $4.2 billion and some of that could be fraudulent. Now, is it valid to translate that into every illegal alien who claimed this tax credit was committing fraud?

    • Ted Biondo

      Nitpicking, JRM_CommonSense. People who shouldn’t even be in the country are stealing U. S. tax dollars. What difference does it make if it’s $1, $2, $3, or $4.2B? The problem is still what is the IRS doing about it?

      You wrote that, “However, when you read the Inspector General’s complete statements you see that he is saying that the total dollar value paid to illegal aliens claiming this tax credit is $4.2 billion…” These people shouldn’t even be here, let alone receive tax refunds of any amount, whether it’s fraud or not?!

      That’s the point of the post.

  17. Carol Foster

    And so without the information needed, Ted, Expects the IRS to round up these folks.
    The person with the information should have given it fully and filed for a percentage of any money recovered from the supposed fraudulante tax returns.
    Please note, when a poster like JRM, asks common sense questions, Ted’s responce is these people shouldn’t even be here.
    Wow, that’s so helpful.
    Got anymore non solutions for us, Ted?

  18. JRM_CommonSense

    So the point of the post is really illegal aliens as I suspected, and y’all want the IRS to capture all illegal aliens whether they have committed tax fraud or not and ship them back home. Not sure that is going to work since that is not their job, and they are not funded to do that job.

    So, since the Immigration Department, Border Patrol, and more recently Homeland Security have been unable to solve the immigration problem for the last 50 to 100 years it is now time to assign Immigration duties to the IRS. I wonder how that’s gonna work out.

  19. expdoc

    Well apparently, since they are receiving checks and cashing them somewhere, it might work out pretty well. If nothing else, it will stop truly illegal immigrants from taking money to which they have no right.

  20. SNuss

    While this is a bit off-topic, we were speaking of criminals:

    Keith Judd, who is serving a 17 1/2-year prison sentence for extortion at the Federal Correctional Institution in Texarkana, Texas, took 41 percent of the vote in West Virginia’s Democratic primary Tuesday night — 72,000 votes to Obama’s 106,000.

    Read the rest at: http://www.washingtonpost.com/blogs/the-fix/post/why-felon-keith-judd-did-so-well-against-obama-in-west-virginia/2012/05/09/gIQA7GwtCU_blog.html

    Quite a turnout for someone who couldn’t make campaign appearances, isn’t it?

    • Ted Biondo

      SNuss, I’m surprised that Obama even got 59% of the vote running against such a qualified candidate already experienced in taking other people’s money.

  21. snuss

    BTW, you don’t have to be an “undocumented Democrat” to game the system, documented ones can do equally well:

    A woman who is eight-months pregnant with her sixteenth child is claiming police brutality after she says Tampa officers used a stun gun on her.

    Tampa police arrested Angel Adams, 39, this week and charged her with battery on a law enforcement officer after a scuffle when police came to her home to talk to one of her sons. She says the stun gun endangered her life — and the life of her unborn child.

    Adams, 39, first made headlines two years ago when she was evicted from her apartment, then moved into a small motel room with 12 of her 15 children. Her story angered many when she angrily demanded, “Somebody needs to pay for all of this.”

    After legal struggles and with the help of the Department of Children and Families, Adams was able to move into a home large enough for her entire family.

    On Tuesday, police wanted to speak to one of her sons about throwing rocks at another home in the neighborhood. He said he didn’t do it and ran from the police.

    Angel Adams says two officers – a man and a woman – forced their way into her home.

    “I told officers, ‘Don’t come in my house. You don’t have a search warrant,” she said.

    After forcing their way in, Adams said she was pushed by one of the officers. She said there was a struggle and her 21-year-old daughter, also named Angel Adams, fought with police.

    The elder Adams said she ran to her room, followed by the female officer, who grabbed her and threw her onto her bed.

    Then, the male officer used a stun gun on her, Adams said. Adams has marks on her back similar to those left by the projectiles used by stun guns.

    “I felt something … shooting through me,” Adams said.

    Tampa police have a different account of what happened.

    The female officer “was at the door, went in to talk to the kid, and at that point, he physically punched the officer, so at that point now we have a struggle,” Tampa police spokeswoman Andrea Davis said. “While [the male officer] was struggling with that kid, the pregnant suspect and her daughter were fighting with [the female] officer.”

    Davis said Adams and her daughter took the female officer out of the house, leaving the male officer alone in the home with four people and at risk.

    “Her (Adams) actions, that’s what determined these results,” Davis said, “and it’s incredibly concerning that someone would put themselves and their unborn child at risk.”

    Adams and her daughter were arrested and charged with battery on a law enforcement officer. Adams was released on $2,500 bail, and her daughter on $1,000 bail.


  22. Dave Francis

    No discrimination or racial profiling from the Constitutional TEA PARTY, but are against the illegal immigration occupation from any person, from any country who came here without permission. The TEA PARTY comprises of small and large chapters throughout America of every nationality, every race and every religious denomination? Replace all lawmakers, Governors, Mayor, police chiefs and all elected administrators in every federal, state and municipal agency that doesn’t have the same judgment of the Tea Party leaders. If you cherish your freedoms from the corruption in Congress that will benefit all of us, we need a balanced tax code with no subsidies, loopholes for corporations, sugar industry or anybody else; a right to drill on the Peoples public lands and sea with its massive reservoirs of oil, natural gas for the consumer and to alleviate our out-of-control 16 trillion dollar deficit. No more government bail outs for the friends of the Oval Office. Begin ‘Attrition through Enforcement’ by enacting E-Verify to eject illegal aliens from the workplace. Complete coverage of ‘Secure Communities” for every state to locate the foreign criminals. Throw out all the profiteering lawmakers and clean house; put familiar TEA PARTY leaders in their place. Introduce a waste and reduction law, which begins the process of shrinking the size of government. Then according to a recent study by the Heritage Foundation another Comprehensive Immigration Reform package, better known as AMNESTY, would cost taxpayers an estimated $2.6 Trillion dollars to process and complete. Another giant price tag we cannot accept. Currently the 50 states have unfunded mandates of supporting foreign nationals of $113 billion dollars annually and counting.

    Voters need to insist from Congress, specifically from GOP House speaker, John Boehner of Ohio and Dave Camp of Michigan, as the Chairman of the powerful Ways and Means Committee to stop blocking the 50-state E-Verify bill. Call the Washington switchboard at 202-224-3121 Washington, DC. For further truth, not propaganda on this crisis matter, check with NumbersUSA website, where even Congress consults on immigration matters. Arizona dared to go up against the feds, who are a controlling mega-monster that are to blame for not enacting strict immigration laws. If entry by stealth as visa overstays are or just slipping past the agents at the border was classified as a felony, they numbers of people coming here would have been minimal. Now the U.S government has 20 million plus to contend with and so the best they can do, is antagonize individual states trying to protect their citizens from unfunded mandates. Arizona and a very few other states are ‘carrying the can’ for states as with Sanctuary States like California, Nevada, Colorado who have too much of a mushy backbone to join the fight? Also in the news are illegal aliens stealing $4-2 billion dollars in taxpayers’ money, owing to a gaping loophole in the child tax dependency credit.

  23. Y.Yossarian says:
    “You complained in a recent post about the poor math skills taught in schools these days. Apparently the grammar skills taught in your day were just as bad.”

    “it is unprofessional and undignified.”

    I say:
    Someone complaining of grammar should really use proper capitalization. Nitpicking always comes back to bite ya…

    Back on topic. Yes, some documented citizens partake in fraudulent tax practices. My question is, how in any way, does that render illegal aliens doing the same (in one fashion or another) a moot point? On top of being in this country illegally and committing tax fraud–you would rather focus on the people here legally? Really?

  24. Jaybo

    RSS – I also got a kick out of Y.Yossarian’s flubbing of “siting your cites” in the exact same sentence where Ted is called out for his prior misuse of “segway”. At least get through your nitpicking sentence without making the same mistake you are nitpicking about!


  26. Just for a clarification: the refundable additional child tax credit that you are discussing was pass under George W. Bush Administration and a Republican controlled congress. They are part of the tax cuts scheduled to lapse in 2012. So I don’t think it is fair to call it a liberal program.

    Clearly, these activities represent tax fraud and not a loop hole.

    • Ted Biondo

      JC – If you have read my blog you know that I have blamed George Bush for almost as much as I have Obama about the deficits and the national debt, etc. Obama is much better at it. You are absolutely correct, it doesn’t matter who passed the law, however, George Bush is more liberal than I, but this is fraud on the part of those filling out the returns, not a loophole. Ok?

  27. snuss

    Just an update:

    Harry Reid Deliberately Helps Illegal Aliens to Continue Looting Us for $Billions

    On Tuesday, Senate Majority Leader Harry Reid (D-NV) blocked a move to bring the Child Tax Credit Integrity Preservation Act (S577) to the floor, and in doing so, assured that those working in this country illegally will continue to receive billions of dollars in tax refunds for children that do not even live in this country.

    In 2011, U.S. Treasury Department Inspector General Russell George released a report revealing that the Internal Revenue Service doled out $4.2 billion in refundable tax credits to illegal alien in 2010 alone.

    Read more at: http://www.examiner.com/article/thanks-to-harry-reid-illegal-aliens-will-continue-to-receive-irs-refunds?cid=db_articles

  28. Tamela McCroskey-Pedroza

    This article is correct because I live in a very small town in Pulaski, VA and I know for sure of two and probably more that have done this. I sent a letter to the US Senator for VA last week but have heard nothing. One of the men filed taxes and received 8400 dollars by claiming family in Guatamala because it is only him here and the other claimed his mother, father, and 3 neice/nephews in Guatamala. All they had to do was go pick up a Double 007 and they easily did this. It makes me so mad because I have raised three kids alone for years and get no help. They pick up this money so easily and I promise you that I know for a fact they NEVER paid in one cent to taxes. Their boss pays them back check and he pays them a set amount each week and makes it look like they pay taxes but they DO NOT. It is so wrong. I sure he heck have to pay my taxes.

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