On Jan. 28, 2013 President Obama addressed the nation with his plan to reform the immigration process for a reported 11 million undocumented immigrants in the U.S. This plan had been blocked by citizens and legislators worried that immigrants who have not paid into the tax base would become eligible to apply for additional social programs and tax credits.
The 11 million undocumented immigrants reported are only a portion of the 36 million illegal immigrants in the U.S. that are recorded in federal immigration reports. New reform would require citizenship applicants to pass civics and English language tests along with a federal background check.
American citizenship could force those previously known as working illegal immigrants to provide honest tax records moving forward. According to human resource administrator Mary Jennings historical records demonstrate that illegal immigrants don't expect to file taxes or receive retirement so they report having eight dependents to avoid paying into Social Security or taxes. They realize that their employment period may end abruptly when a letter from Social Security arrives two months later at their employer announcing that they used a false Social Security number.
If the 36 million illegal aliens acquire citizenship and a social security number they will be eligible to file for the Earned Income Credit. This could provide $72.3 billion to the Latin community. In addition to the EIC they would become eligible for Obamacare valued at over 360 billion dollars a year.
Immigrants who have over-reported their deductions many not want to pay back taxes or fines under the proposed reform and may not have the resources to pay. According to federal reports illegal immigrant families are typically poor due to language barriers, lack of completed education, low skill set, and size of families which are counter-weighted with social services. Forty-eight percent of all Latin American immigrants have not graduated from high school. All of these considerations contribute to the reason that most illegal immigrants are paid around minimum wage.
Here is a demonstration of government withholdings for an illegal alien using a stolen Social Security Number, (if they claimed 4 dependents on their W-4)
Gross annual income: $20,800.00
Nontaxable Retirement Benefits 0.00
Nontaxable Cafeteria Benefits 0.00
Annual FICA withholding 1,289.60*
Annual Medicare withholding 301.60
Annual Federal withholding 0.00
Annual Oregon withholding 417.00
Year-end net pay $18,791.80* (qualifies for $4,092 in annual food stamps and $20,000 in Oregon Health medical programs)
In this demonstration the withholdings are set to (4), and notice that it does not reduce their Federal Insurance Contributions Act withholding for Social Security Trust Fund. This fund provides retirement income, as well as disability insurance, Medicare, and benefits for survivors. In the above example an immigrant would have contributed a total FICA Withholding 1,289.60 for year 2010 ($107.46 mo).
When considering how much money is contributed into the Social Security retirement fund; any person who earned minimum wage for 44-years would have contributed a total balance of $38,274 to draw from. However the problem with Social Security funding shortage isn't left to recipients using up their balance. One of the factors is that the program pays out until the recipient dies even after the recipients deposited funds have been used up. According to current immigration reform strategy these immigrants would never participate in the Social Security program.
Department of Homeland Security, reports that nearly eighty percent of the total U.S illegal immigrant population are from Latin America. Sixty percent of all illegal aliens are from Mexico. Worsening the problem is that 400,000 U.S. children are born to illegal aliens each year. The Latin population is growing so fast that it has been predicted by the Census Bureau that at some point in the future the U.S. will primarily be Latin.
One consideration that allows the Latin population to grow is America's social programs. As long as any parent feels that they can provide food, medical, and housing for their children they will continue to reproduce to unfounded numbers; especially if the parent cannot find employment.
Illegal immigrant families are currently eligible for hardship application for monthly food stamps, Welfare, and subsidized rent. The more children in a household the more eligible they become for greater social benefits.
Even when immigration reform takes effect it will not stop the tendencies of the Latin population to overuse the American social programs.
According to federal social services reports, in 2004 illegal alien households used $2,700 more social services than they paid in taxes. Households headed by a legal Mexican immigrant created a net fiscal drain at the federal level of roughly $15,000.
Currently America provides to immigrants education, food stamps, WIC, school lunch, Medicaid, TANF, subsidized housing. EAEDC or TAFDC as a severely disabled adult or child, Supplemental Security Income, Disability or blindness payments under Title II, or Retirement, or Survivor Disability Insurance (RSDI).
It is of the interest of every citizen to clean up the illegal activities surrounding immigration and the pay-outs from social services that empties the pockets of every tax payer. Americans will have to wait for the final reform documents to see what happens after illegal immigrants continue to refuse to apply for citizenship to avoid paying back taxes and fines.