April 28, 2012 · By Dr. Theo · 4 Comments
WTHR Channel 13 in Indianapolis has uncovered a disgraceful fraud that should be national news every evening until the problem is rectified. All workers, citizens, legal immigrants and illegal aliens are required to report earnings to the IRS. Without a Social Security Number illegals are issued an ITIN, an individual taxpayer identification number. With that illegals can then claim an “Additional Child Tax Credit” of up to $1000 dollars per claimed child. And that child can be a niece or nephew and live in Mexico! According to this report some illegal workers are collecting up to $30,000 each year by claiming twenty dependents that have never even visited the U.S.
The IRS knows about this but claims it is legal and can only be changed by Congress. Yet, when the IRS instructions regarding the “Additional Child TaxCredit” are carefully examined we find that there are specific requirements that must be met to qualify: A qualifying child for this credit is someone who meets the qualifying criteria of six tests: age, relationship, support, dependent, citizenship, and residence. As you’ll see in this report, the IRS is intentionally ignoring disqualifying factors and awarding pay-outs that American citizens could never qualify for.
Please note, we are not talking about the “Child Tax Credit” that allows a deduction for dependent children that reduces the tax liability of a worker. The “Additional Child Tax Credit” is an actual pay-out for claimed dependent children that can be awarded even if the worker pays no tax. This is costing American taxpayers over 4 billion dollars per year.
The loophole is called the Additional Child Tax Credit. It’s a fully-refundable credit of up to $1000 per child, and it’s meant to help working families who have children living at home.
But 13 Investigates has found many undocumented workers are claiming the tax credit for kids who live in Mexico – lots of kids in Mexico.
“We’ve seen sometimes 10 or 12 dependents, most times nieces and nephews, on these tax forms,” the whistleblower told Eyewitness News. “The more you put on there, the more you get back.”
The whistleblower has thousands of examples, and he brought some of them to 13 Investigates. While identifying information such as names and addresses on the tax returns was redacted, it was still clear that the tax filers had received large tax refunds after claiming additional child tax credits for many dependents.
“Here’s a return right here: we’ve got a $10,3000 refund for nine nieces and nephews,” he said, pointing to the words “niece” and “nephew” listed on the tax forms nine separate times.
“We’re getting an $11,000 refund on this tax return. There’s seven nieces and nephews,” he said, pointing to another set of documents. “I can bring out stacks and stacks. It’s just so easy it’s ridiculous.”
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