Ken Sweet, Associated Press
NEW YORK (AP) — The Trump administration has proposed a requirement for U.S. taxpayers to disclose their citizenship and work authorization status to the IRS as part of changes to the annual tax form. Administration officials state that this requirement aims to prevent immigrants without permanent legal status from collecting federal benefits they are not eligible for, potentially saving taxpayers up to $2 billion. However, taxpayer and privacy advocates express concerns that this data could be utilized for immigration enforcement.
David Bier, director of immigration studies at the Cato Institute, commented, "It could be used as an immigration enforcement tool and that is probably the reason why they are doing this."
The proposed change would introduce a new checkbox on tax returns, which could complicate the filing process for individuals living in the country illegally. They would face the choice of either declaring their unauthorized status, which is a felony, or not filing taxes altogether. Nina Olson, executive director for the Center for Taxpayer Rights, criticized the proposal, stating, "It's dragging the IRS into this administration's immigration policies."
The IRS has released a draft of the 1040 form for 2026, which includes a question regarding the citizenship status of the filer and their spouse. The question is mandatory, requiring taxpayers to certify their immigration or citizenship status under penalty of law.
The Treasury Department has indicated that the new question is intended to prevent unauthorized immigrants from claiming refundable tax credits, such as the Earned Income Tax Credit (EITC) and the Additional Child Tax Credit (CTC). A Treasury official stated that the information collected would be subject to various privacy protections, though it remains unclear if it will be shared with immigration enforcement agencies.
Despite lacking permanent legal status, many immigrants still pay taxes. A report by the National Taxpayer Advocate in 2024 noted that 3.8 million tax returns were filed using Individual Tax Identification Numbers (ITINs), with these taxpayers contributing $14.4 billion in income taxes and $6.5 billion in Social Security and Medicare taxes.
Olson argues that the new proposal is unnecessary, asserting, "Your citizenship or residency status is not information the IRS needs to process a return. It's not even information the IRS needs to process these tax credits."
Under current law, immigrants without permanent legal status are generally ineligible for federal benefits. The proposed policy could affect those currently eligible for credits, including individuals under the Deferred Action for Childhood Arrivals (DACA) program and those with temporary protected status.
The Trump administration's proposal suggests that the Personal Responsibility and Work Opportunity Reconciliation Act should also apply to refundable tax credits. Research estimates that approximately 671,000 individuals, including 309,000 children, could lose the EITC under this policy, while around 1.1 million people, including 574,000 children, may lose the CTC.
Most affected children are U.S. citizens, as their eligibility is tied to their parents' immigration status. The administration has previously attempted to use the IRS to enforce immigration policies, including a data-sharing agreement with U.S. Immigration and Customs Enforcement (ICE) that was halted by a federal judge for violating taxpayer privacy laws. Before the agreement was stopped, the IRS had already provided addresses of 47,000 individuals to ICE.