Do Undocumented Immigrants Pay Taxes?

There are many people in the United States who are considered undocumented immigrants. These individuals can fall into many categories. And, many of them are able to make money while they’re in the United States. If they do, you might wonder, are they required to pay taxes?  

The answer, surprisingly, is yes. And, doing so can actually be helpful if and when these individuals apply for U.S. citizenship.

The SSN Dilemma

Since undocumented immigrants don’t have social security numbers (SSNs) and since tax forms require this number, you may be wondering how an undocumented person could possibly file a return.

The best option in this scenario is for the person to apply for a special, temporary Social Security number. This typically poses no problem for noncitizens who have been temporarily authorized to work or who have Temporary Protected Status or a work visa.

The Individual Taxpayer Identification Number Option

If a person doesn’t want to apply for a Social Security number, they could consider filing for an Individual Taxpayer Identification Number (ITIN) instead. These numbers can be used just like a Social Security number, at least for tax filing purposes.

Individuals who wish to apply for one of these numbers can simply fill out IRS Form W-7, which is an application for the ITIN.

What About Tax Breaks?

While filing taxes is the right (and legal!) thing to do, undocumented workers typcially have to pay their taxes in full, without any tax breaks—with a few exceptions.

Undocumented workers can get the American Opportunity Tax Credit if they had an ITIN or applied for one before the due date of their tax return. They may also claim the Child Tax Credit and Additional Child Tax Credit if their children are under the age of 17, documented, and have Social Security numbers.

Ultimately, it can be challenging for undocumented workers to file and pay their taxes. However, to avoid trouble with the IRS and to increase their chances of obtaining citizenship, they should file and pay taxes in the best way that they can.