APRIL 2003

• Immigration and Naturalization Service

• The New York City Mayor's Office Of Immigrant Affairs and Language Services

• Citizenship NYC

• New York Immigration Hotline

• National Immigration Forum

• Genealogical Resources in the New York Metropolitan Area

• America Immigration Lawyers Association and the American Immigration Law Foundation

• Lesbian and Gay Immigration Rights Task Force

• Glossary

Local: General

• Archdiocese of New York Immigrant and Refugee Services

• Citizens Committee For New York City

• Hebrew Immigrant Aid Society

Local: Specific

• Asian Americans for Equality

• Asian American Legal Defense and Education Fund

• CARECEN-N.Y.

• Chinese Progressive Association

• Emerald Isle Immigration Center of New York

• Korean Community Services of Metropolitan New York

• National Association of Korean Americans

• National Coalition for Haitian Rights

 

 

A Taxing Time of Year

By Josh Brustein

Satwant Kour is accustomed to people coming to her with tough questions. Her organization, Workers Awaaz (the name means workers' voice in most South Asian languages), assists domestic workers with issues of exploitation on the job. But as the April 15th deadline to file taxes approaches, many of her clients, almost all of them undocumented and working off the books, have one question. What about taxes?

"People are confused about what they should do," said Kour. "Whether they should pay or whether they should not. They are also scared. There is a lot of confusion in their minds."

Undocumented workers cannot work legally, but those who do work are still required to pay taxes. Over half of New York City's undocumented immigrants follow this law and file using a special taxpayer number provided by the Internal Revenue Service, according to a 1998 Urban Institute. They may be hoping to get a tax refund, wanting to obey whatever laws they can, or betting on the chance that paying taxes may help them gain citizenship further down the road. To counteract these benefits however, there are many problems and fears that keep many immigrants--both documented and undocumented--from filing.

Common Concerns

In many ways, the challenges that undocumented workers face during tax season are similar to those of any other low-income worker. Many work sporadically, and earn very little. And for the most part, they are either paid off the books or misclassified as independent contractors by employers looking to avoid paying taxes themselves.

When the time to file taxes comes, they have no record of what they have earned. This leaves the taxpayer with a common yet difficult decision, according to Amy Brown, director of the Community Food Resource Center . "They could report their employer, they could request the W-2, and they could get the employer in trouble," she said. "But if they feel that they need that job then they may very well choose to file as self-employed and not take those steps." Often, they choose the latter.

But filing as self-employed, or being classified as an independent contractor, leaves a worker to pay both the employer and the employee's share of certain taxes, like unemployment insurance and social security. For those working for very little already, this is a huge burden. Being unsure about what to do in this situation, and the fear of the complicated tax system in general, keeps many away, according to Brown.

Fears and Hopes

Another reason that immigrants don't file, according to Kour, is that they are afraid to put their names into what they see as a hostile system after 9/11. "Everybody's scared," said Kour, who works almost exclusively with South Asians, a group that has felt a particularly harsh backlash in the past eighteen months. "Especially nowadays with this registration going on and Homeland Security."

But while post September 11th policy has involved crackdowns on immigrants in other places, the Internal Revenue Service continues its policy of not sharing information with the federal immigration agencies. "We don't do routine information sharing," said Kevin McKeon, a spokesperson for the agency in New York. "We have our disclosure laws, which are part of the tax code, which prohibit us from sharing information."

In fact, the Internal Revenue Service, working to get even the most reluctant taxpayers to file, has several programs for immigrants who aren't legally able to work but do so. In 1996, it developed the Individual Taxpayer Identification Number, which people who are not eligible for a social security number can use to file. At the end of last year's tax season, 4.9 million such numbers were issued nationwide. There are also various tax credits, like the Child Tax Credit, which low income workers are eligible for regardless of their immigration status.

"It is in the IRS's best interest to collect taxes and to have people be compliant, regardless of their legal status," said Brian Cheigh, who runs tax clinics for South Brooklyn Legal Services, with partial funding from a Low Income Taxpayer Clinic grant from the IRS.

Filing can be in the best interests of undocumented immigrants as well. Brown points out that the possibility that low-income immigrant workers will gain from filing taxes is much greater than the possibility of them losing. "We've done a lot of taxes for immigrants, legal or not," she said. "People who are filing their taxes -- and for many people this is the first time they are filing their taxes because they have been afraid of dealing with the tax system -- by far we're getting [them] money back that they are due."

One of the most significant sources of tax relief available to low income workers is the Earned Income Tax Credit. Undocumented workers are not eligible -- a social security number is required to qualify -- but many legal immigrants are. The credit, which can reach a total of $5,000 per family, is essentially a reverse income tax for low-income workers. Lack of knowledge about the credit and fear of the tax system in general, problems that are even more common among immigrants than they are in other low-income communities, cause about 230,00 eligible New York City workers to miss out on half a billion dollars in credits each year.

Despite their fears of putting themselves onto the government's radar screen, many undocumented immigrants want to file taxes in the hopes that being compliant will aid them if and when they get a chance to change their immigrant status. This has been true in the past. The Immigration and Naturalization Services (now the Bureau of Immigration and Citizenship Services) regularly looks at tax compliance during immigration proceedings. And in an amnesty in 1986 that helped more than 2.7 million immigrants get legal status, tax records were used to establish residency.

Although a repeat of any amnesty in the near future seems very unlikely -- conversations between George W. Bush and Mexican President Vincente Fox regarding undocumented Mexican immigrants ended abruptly after September 11th, 2001 -- immigration advocates say that any new measure will almost certainly take taxes into account. Getting one's name into the system might actually be a good thing.

"If and when someone has the opportunity to apply for an adjustment of status, tax records can show that they have worked, that they are able to support themselves, which is important," said Amy Sugimori, of the National Employment Law Project."It is a way of being able to document earning capability, and that you have good moral character."

The chance of this happening is enough to make some undocumented immigrants overcome their fears and file.

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