Trump Administration Proposes New Tax Filing Requirement

The Trump administration has suggested that U.S. taxpayers disclose their citizenship and work authorization status when filing taxes with the IRS. This change would be part of the annual tax form that most workers submit each year.

The administration argues that this requirement is intended to prevent undocumented migrants from accessing federal benefits they aren’t entitled to. Officials believe this could potentially save taxpayers around $2 billion.

In late August, the IRS released a draft of the 2026 tax form, which now includes a question asking whether the filer, and their spouse if applicable, is a U.S. citizen, U.S. national, or legally authorized alien. There are checkboxes for “Yes” and “No” beside each question.

Additionally, a draft of Schedule 3-A, used for claiming refundable tax credits, includes a similar inquiry.

Legal Implications

Under this new proposal, anyone filing taxes would be required to confirm their immigration or citizenship status, with legal penalties in place for those who do not comply.

The Treasury Department indicated that the new question aims to restrict illegal migrants from benefiting from refundable tax credits like the Earned Income Tax Credit and the Additional Child Tax Credit, which are often claimed by low- and middle-income families to receive refunds.

A Treasury official noted that information collected would be protected by various privacy and legal safeguards, although it remains unclear if this data could be shared with immigration enforcement agencies.

Interestingly, while unauthorized migrants typically cannot access federal benefits, they do pay taxes; for example, many contribute to Social Security without being able to claim benefits unless they later qualify under specific laws.

In 2024, around 3.8 million tax returns were filed using an Individual Tax Identification Number (ITIN). These numbers are often used by undocumented individuals who cannot obtain a Social Security number.

According to IRS statistics, those nearly 4 million returns contributed a significant $14.4 billion in income taxes, along with $6.5 billion in contributions to Social Security and Medicare.

To qualify for the Earned Income Tax Credit, a valid Social Security Number is mandatory—something ITIN holders do not possess. The IRS verifies these numbers against records from the Social Security Administration for credit claims.

Eligibility Concerns

It’s worth noting that some migrants, including those protected under the Deferred Action for Childhood Arrivals (DACA), temporary status holders, and H1-B visa workers, may lose access to certain credits under this new policy.

The administration asserts that the existing Personal Responsibility and Work Opportunity Reconciliation Act should guide eligibility for refundable tax credits.

Research estimates suggest that about 671,000 people, including 309,000 children, could lose the Earned Income Tax Credit with this change. Furthermore, approximately 1.1 million people, including 574,000 children, may no longer qualify for the Additional Child Tax Credit.

Surprisingly, many affected children are U.S. citizens themselves, simply due to their parents’ immigration status.

Opponents of the new policy argue it represents a troubling step that further increases federal scrutiny of taxpayers. Illegal migrants might find themselves facing a dilemma: declare their legal status and risk deportation or falsify their tax return, which is a felony.

Some may even choose to stop filing taxes entirely.

David Bier, from the Cato Institute, expressed concerns: “It could become an immigration enforcement tool, and that’s likely part of the intent behind this.”

Previous Attempts and Issues

Nina Olson, executive director of the Center for Taxpayer Rights, commented on the matter, stating, “It’s pulling the IRS into this administration’s immigration policies.” The Trump administration has sought to utilize the IRS to further its immigration agenda in the past.

Just last year, the Treasury Department had plans to allow sharing taxpayer information with Immigration and Customs Enforcement (ICE) to assist in identifying individuals for deportation. However, a federal judge intervened, blocking this data-sharing agreement on the grounds that it violated taxpayer privacy laws. Prior to that intervention, the IRS had already disclosed the addresses of 47,000 individuals to ICE.