{"id":3213,"date":"2013-04-25T11:30:58","date_gmt":"2013-04-25T15:30:58","guid":{"rendered":"http:\/\/live-immigrationreform.pantheonsite.io\/?p=3213"},"modified":"2018-12-28T16:08:16","modified_gmt":"2018-12-28T21:08:16","slug":"gang-of-eight-breaks-promise-on-back-taxes","status":"publish","type":"post","link":"https:\/\/www.immigrationreform.com\/2013\/04\/25\/gang-of-eight-breaks-promise-on-back-taxes\/","title":{"rendered":"Part I: Gang of Eight Breaks Promise on Back Taxes"},"content":{"rendered":"

A close analysis of the Gang of Eight\u2019s amnesty bill (S.744) shows that illegal aliens will in fact not<\/span> be required to pay back taxes in order to receive legal status, which the bill calls \u201cregistered provisional immigrant\u201d (RPI) status.<\/p>\n

This conclusion turns on one word used in the text of the bill: \u201cassessed.\u201d \u00a0Under S.744, an alien may not even file an application for RPI status \u201cunless the applicant has satisfied any applicable Federal tax liability.\u201d\u00a0 (Sec. 2101, p.68-69)\u00a0 \u201cApplicable federal tax liability\u201d is defined as \u201call Federal income taxes assessed.\u201d\u00a0 (Id<\/i>.)<\/p>\n

While this sounds good at first blush, one must look closer at the exact words used.\u00a0 First, “taxes assessed” does not mean “taxes owed.”\u00a0 A tax is “assessed” when the IRS officially records<\/i> that a person owes a tax.\u00a0(See, e.g.,<\/i> Warren, Gorham & Lamont Treatise on Tax Controversies, \u00a7 3.01; Warren, Gorham & Lamont Treatise on Tax Procedures, \u00a7 10.01) A tax assessment can happen in two ways.\u00a0 One, an individual files a tax return, tells the IRS what he owes, and, after correcting any mathematical errors, the IRS records it.\u00a0 (See<\/i> 26 U.S.C. \u00a76201) Two, the IRS audits an individual\u2014whether or not he has filed a return\u2014and, after giving the taxpayer an opportunity to contest, records how much the person owes.\u00a0 (See<\/i> 26 U.S.C. \u00a76212)<\/p>\n

This leads to two possible scenarios in which the “back taxes” of an illegal alien will have been “assessed.”\u00a0 In the first scenario, the\u00a0illegal alien has filed\u00a0a tax return and the IRS has\u00a0“assessed” any unpaid portion of the reported tax.\u00a0 This will be a rare scenario since\u00a0an illegal alien is unlikely to\u00a0file a return reporting taxes that he is unable or unwilling to pay, for fear of causing trouble with the federal government.\u00a0 In the second scenario, the illegal alien is working off the books, has not filed a return, and has been audited by the IRS.\u00a0 This will also be a very rare scenario since\u00a0the IRS has no knowledge of the alien’s existence. \u00a0In short, despite the promises of the authors, the Gang of Eight has drafted a tax provision that will almost never require illegal aliens to pay “back taxes” as a condition of receiving amnesty. <\/p>\n

Other language in the bill supports this conclusion.\u00a0 For example, there is no requirement that the alien present himself to the IRS for a tax assessment before or during the application process.\u00a0 Nor is there any requirement that an alien submit specific information (employment history, wages, etc.) that would indicate that taxes are owed.\u00a0 And even if S.744 required illegal aliens to submit such information to DHS when they apply for amnesty, there is no requirement that DHS share it with the IRS in order to allow an assessment.\u00a0 <\/p>\n

Not only does the Gang of Eight bill utterly fail to make illegal aliens pay federal back taxes as a condition of getting amnesty, there is no requirement that illegal aliens pay state or local back taxes either.\u00a0 Finally, the Gang of Eight gives employers their own amnesty by failing to require that they too pay back taxes for any illegal aliens they employed over the years.\u00a0 In fact, the Gang of Eight amnesty bill provides that any documents provided by an employer to enable an illegal alien to apply for amnesty may not be used against him in a civil or criminal prosecution for hiring that illegal alien. (Sec. 2104, p.120).