Treasury Department to Restrict Tax Credits for Undocumented Immigrants
The Treasury Department, under President Trump’s directive, intends to introduce new regulations preventing undocumented immigrants and foreign nationals from obtaining significant earned income tax credits like the Earned Income Tax Credit and the Supplemental Child Tax Credit, as reported by Breitbart News.
In a statement on Thursday, Treasury Secretary Scott Bessent mentioned that the department will clarify eligibility criteria for the earned income tax credit in line with the 1996 Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA).
“We are dedicated to enforcing the law, ensuring that illegal aliens cannot claim tax benefits meant for American citizens,” Bessent remarked.
This rule emphasizes that the refundable segments of the Earned Income Tax Credit, Additional Child Tax Credit, American Opportunity Tax Credit, and Saver’s Match Credit are classified as federal public benefits, thereby excluding illegal aliens and other non-citizens from accessing them.
“Our Office of Tax Policy and the IRS have been committed to advancing this initiative and ensuring it is implemented effectively,” Bessent added. “Their dedication showcases this administration’s resolve to uphold the integrity of our tax system. We will keep working to make sure taxpayer dollars only go to those legally entitled to them.”
The regulation follows an opinion from the Department of Justice’s Office of General Counsel, interpreting the Earned Income Tax Credit as a federal public benefit, thus excluding illegal aliens from eligibility.
Research indicates that undocumented immigrants who received Social Security numbers likely obtained cash payments totaling about $2.9 billion, with around $2 billion from the Earned Income Tax Credit and approximately $890 million from the Supplemental Child Tax Credit.
Additionally, illegal aliens possessing Individual Taxpayer Identification Numbers are estimated to have received between $870 million and $1.6 billion in other child tax credit payments.
The new Treasury Department rules are expected to take effect starting in the 2026 tax year.
