Safeguards put in place to help prevent Child Tax Credit (CTC) benefits from flowing to illegal immigrants, that Republicans passed as part of the 2017 Trump tax cuts, will be eliminated if Congress fails to act. Throughout the 25-year history of the CTC, there was no meaningful safeguard with respect to illegal immigration until the 2017 Trump tax cuts, when Congressional Republicans added a Social Security Number (SSN) requirement as part of eligibility for the credit. After the SSN requirement was passed in the Trump tax cuts, the improper payment rate for the CTC was cut in half.
However, if Congress fails to extend the Trump tax cuts, not only will taxes go up on American workers, families, farmers, and small businesses, but 40 million families will see their CTC slashed from $2,000 to $1,000 and these critical safeguards against fraud, misuse, and access by illegal immigrants will vanish.
Ways and Means Committee Chairman Jason Smith (MO-08) issued the following statement on the need to protect the integrity of the Child Tax Credit:
“The Child Tax Credit is a lifeline for millions of hardworking American families, but its integrity is under threat. Thanks to the 2017 Trump tax cuts, Republicans put in place a critical safeguard requiring a Social Security Number for eligibility, slashing the improper payment rate in half and ensuring the credit helps those who it was intended to help. With the Biden Administration having allowed millions of illegal immigrants to enter the country over the past four years, weakening this protection should be a nonstarter. And yet, these safeguards are at risk of vanishing if Congress fails to act. By extending the Trump tax cuts, we can extend this protection to help prevent tax benefits from flowing to illegal immigrants. We cannot afford to squander the opportunity the American people gave us.”
Key Facts:
- The 2017 Trump tax cuts doubled the Child Tax Credit (CTC) from $1,000 per child to $2,000.
- The new CTC policy also included a requirement that a child must have a valid Social Security Number (SSN) to be eligible to receive the credit.
- After the SSN requirement was passed in the Trump tax cuts, the improper payment rate for the CTC was cut in half
- If Congress fails to extend the Trump tax cuts, the SSN requirement will go away, which will increase the flow of tax benefits to illegal immigrants.
Key Policies from the Trump Tax Cuts Set to Expire if Congress Fails to Act
- Congress only has 149 legislative days next year to act before the Trump tax cuts expire.
- The average taxpayer would see a 22% tax hike if the Trump Tax Cuts expire.
- A family of 4 making $80,610, the median income in the United States, would see a $1,695 tax increase if the Trump Tax Cuts expire.
- This is worth about 9 weeks of groceries to a typical family of 4 across the country.
- 40 million families would see their household’s Child Tax Credit cut in half.
- 90 percent of all taxpayers would see their Guaranteed Deduction slashed in half.
- 26 million small businesses would be hit with a 43.4% tax rate if the 199A Small Business Deduction expires.
- 7 million taxpayers would be impacted by the return of the Alternative Minimum Tax.
- 2 million family-owned farms would have their Death Tax Exemption slashed in half next year.
READ: Trump Tax Cuts Offer Relief For Working Families From Cost-of-Living CrisisREAD: 40 Million Families at Risk of Seeing Child Tax Credit Slashed in Half
