Latinos, Social Security and Taxes
How Illegal Immigrants are Helping Social Security (September 2010)
Stephen C. Goss, the chief actuary of the Social Security Administration and someone who enjoys bipartisan support for his straightforwardness, said that by 2007, the Social Security trust fund had received a net benefit of somewhere between $120 billion and $240 billion from unauthorized immigrants. Read more at http://www.washingtonpost.com/wp-dyn/content/article/2010/09/02/AR2010090202673.html?hpid=opinionsbox1
How Immigrants Saved Social Security (April 2008)
This New York Times editorial, commenting on the 2008 annual report on Social Security, points out how “illegal immigration … is even better than legal immigration” because … “many undocumented workers pay takes during their work lives but don’t collect benefits later.” Click here to read the article.
Undocumented Immigrants as Taxpayers (November 2007)
This Immigration Policy Center fact sheet shows that undocumented men have work force participation rates that are higher than other workers, and all undocumented immigrants are ineligible for most government services, but pay taxes as workers, consumers, and residents. Similarly, another report by IPC, The Economic Impact of Immigration, finds that immigrants use relatively few federal or state public-benefit programs and are a net fiscal benefit to the U.S. economy. http://www.immigrationpolicy.org/just-facts/undocumented-immigrants-taxpayers and http://www.immigrationpolicy.org/just-facts/assessing-economic-impact-immigration-state-and-local-level
Undocumented Immigrants in Texas: A Financial Analysis of the Impact to the State Budget and Economy (December 2006)
This is the first time any state has done a comprehensive financial analysis of the impact of undocumented immigrants on a state’s budget and economy, looking at gross state product, revenues generated, taxes paid and the cost of state services. The absence of the estimated 1.4 million undocumented immigrants in Texas in fiscal 2005 would have been a loss to our gross state product of $17.7 billion. Undocumented immigrants produced $1.58 billion in state revenues, which exceeded the $1.16 billion in state services they received. However, local governments bore the burden of $1.44 billion in uncompensated health care costs and local law enforcement costs not paid for by the state. Click here for the report and a business journal article on the report.
Civic Contributions: Taxes Paid by Immigrants in the Washington, DC, Metropolitan Area (May 2006) by Randy Capps, Everett Henderson of the Urban Institute, Jeffrey Passel of the Pew Hispanic Center, and Michael Fix of the Migration Policy Institute. The Washington, DC, metropolitan area is home to over 1 million immigrants, who composed one-fifth of the area’s total population in 2004. The metropolitan area is relatively affluent and boasts a strong economy that attracts large numbers of immigrants for jobs at both the high- and low-skilled ends of the labor market. Immigrants in the Washington area come from more diverse countries of origin than is the case nationally, and a relatively high share come from origins with above average incomes. Whether higher or lower skilled, immigrants contribute strongly to the region’s economy, purchasing power, and tax base. Immigrant households in the Washington, D.C., metropolitan area had a total income of $29.5 billion in 1999–2000, and they paid $9.8 billion in taxes. This represents 19 percent of the region’s total household income and 18 percent of all taxes paid. Our estimate of the amount of taxes paid by immigrants is an underestimate, because it is based on 1999–2000 data, and the number of immigrants in the region has grown from 850,000 to at least 1.2 million since that time. Although immigrant households on average have lower incomes than native-born Washington, D.C., area households, they pay nearly the same share of their incomes in taxes. Some groups of immigrants—the most educated and highest earners—actually pay more in taxes than natives, on average. On the other hand, less-educated immigrants and those without permanent legal status have considerably lower incomes and pay a lower share of their incomes in taxes than natives. This report estimates the taxes paid by immigrants in the Washington, D.C., area in 1999–2000 and documents their demographics, household composition, income, and dispersal across jurisdictions in the region. The findings in this report are based mostly on analysis of 2000 U.S. Census data, because the census provides the most recent comprehensive data that allow disaggregation by country of origin groups and by many of the region’s local jurisdictions. The demographic data in the report are updated through 2004 using the U.S. Current Population Survey. We calculate taxes at both the individual level (e.g., income and payroll taxes) and the household level (e.g., property taxes), but aggregate them up to the household level. Throughout the report we refer to households headed by immigrants (whether citizens, legal immigrants, or unauthorized migrants) as “immigrant households” and compare their incomes and tax payments to households headed by native-born U.S. citizens. Read the Washington Post article on the report or read the report at:
http://www.urban.org/UploadedPDF/411338_civic_contributions.pdf
Amount of Unclaimed Taxes paid by Immigrant Workers
Each year, the Social Security Administration receives millions of employer-submitted earnings reports that it is unable to place in an individual Social Security record. If the Social Security number and name on a W-2 do not match SSA’s records, the W-2 is retained in the Earnings Suspense File (ESF). The ESF is over $462.8 billion. http://www.gao.gov/htext/d05154.html (March 2005) http://www.ssa.gov/oig/ADOBEPDF/A-15-04-14069.pdf (August 2004)
Study Confirms Contribution Of Legal Immigration To The Social Security System
A February 2005 study entitled “The Contribution of Legal Immigration to the Social Security System” found that, over the next 75 years, new legal immigrants entering the U.S. will provide a net benefit of $611 billion in present value to America’s Social Security system, according to official Social Security Administration data. American Immigration Lawyers Association. Doc. No. 05021862. http://www.aila.org/content/default.aspx?docid=12396
Study: Immigrants Pay Tax Share: No Gap With U.S.-Born Residents Seen in Area, but Those Here Illegally Account for Less (June 2006)
Reliable numbers are hard to find, but researchers generally agree that 50 to 60 percent of illegal immigrants nationwide work for employers who withhold income taxes and Social Security and Medicare payments from their paychecks. The authors of the Urban Institute study assumed 55 percent do. To get jobs, many of those immigrants use false Social Security numbers. That means they pay into the Social Security system for benefits they will never receive and pay income taxes without ever filing a return to determine whether they have overpaid. Read study at: http://www.urban.org/publications/411338.html