Washington, USA
The Trump administration is preparing changes to the US tax filing process that could affect taxpayers next year. Under the proposed changes, taxpayers may be asked to provide information about their citizenship status and legal authorization to work in the United States.
The proposed changes could increase concerns among immigrant communities, particularly those who are uncertain about how information provided on tax returns might be used.
The Internal Revenue Service (IRS) is reportedly preparing to add a new section to the draft Form 1040. Taxpayers would be asked to indicate whether they are a US citizen, a US national, or a foreign national legally authorized to work in the United States.
Taxpayers and Spouses May Have to Respond
Under the proposed form, taxpayers would reportedly be required to answer the citizenship and work-authorization questions with a “Yes” or “No.”
Individuals filing a joint tax return with their spouse may also be required to provide the same information about their spouse.
The administration is viewing the proposed change as part of a broader effort to restrict access to certain federal tax benefits for individuals whose legal status in the United States is unclear or temporary.
However, tax and immigration experts point out that many tax credits already require taxpayers to have a valid Social Security number. As a result, they say the practical impact of the new questions could be limited in some cases.
New Requirement Could Increase Anxiety Among Immigrants
Experts say one of the biggest potential effects of the proposed change could be increased anxiety among immigrant communities.
Some taxpayers may fear that personal information provided while filing tax returns could potentially be used for immigration-related enforcement.
Nina Olson, a former IRS official and executive director of the Center for Taxpayer Rights, has argued that the IRS does not need this information to administer federal tax laws. Her organization has previously taken legal action against the IRS over the sharing of taxpayer data.
Some Immigrants Could Also Be Affected
Meanwhile, the Treasury Department is also moving toward stricter rules regarding eligibility for certain tax credits for some immigrants with lawful status.
According to experts, the proposed changes could affect individuals protected under DACA (Deferred Action for Childhood Arrivals) as well as immigrants living and working in the US on employment-based visas.
Tax preparers and immigration attorneys warn that the proposed changes could create confusion among millions of taxpayers when they file their returns next year.
The administration, however, maintains that the purpose of the changes is to prevent individuals who are not eligible from receiving federal tax benefits.
For now, the proposed changes remain under discussion. The actual impact on taxpayers filing their returns next year will become clearer once the rules are finalized.
