IRS Commissioner John Koskinen confirmed through written responses to Congress that illegal aliens granted amnesty under President Obama's executive actions could claim back tax refunds even if they never filed returns to pay their taxes in the first place. The responses were released by Sen. Chuck Grassley, who pressed Commissioner Koskinen in the past.
In the responses, Commissioner Koskinen admits that his previous testimony was errant and that illegal aliens granted amnesty could claim refunds on tax returns that were never filed due to the Earned Income Tax Credit (EITC).
To clarify my earlier comments on EITC, not only can an individual amend a prior year return to claim EITC, but an individual who did not file a prior year return may file a return and claim EITC (subject to refund limitations under section 6511 of the Internal Revenue Code).
While Social Security numbers are required to claim the EITC, illegal aliens would be granted work permits under President Obama's executive amnesty. Those work permits, in turn, can be used to obtain Social Security numbers. IRS lawyers have ruled that once illegal immigrants get numbers, they can go back and refile for up to three previous years’ taxes and claim refunds even for time they were working illegally.
The lawyers went on to say that since the EITC is a refundable credit, it is applicable even when the illegal aliens worked off the books and never paid taxes in the first place.
“Section 32 of the Internal Revenue Code requires an SSN on the return, but a taxpayer claiming the EITC is not required to have an SSN before the close of the year for which the EITC is claimed,” Mr. Koskinen said. “At your request, the IRS has reviewed the relevant statutes and legislative history, and we believe that the 2000 Chief Counsel Advice (CCA) on this issue is correct.”
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