Frequently Asked Questions
- Over the past several years we have fielded questions regarding our third way immigration reform model and continue to provide answers, conduct follow-up research and make modifications as appropriate. We’ve spoken with Washington staff, Non-Governmental Organizations (NGOs) and others working on immigration issues and have revised our plan to incorporate and address many of their suggestions and concerns.
- During our research we determined that the only logical source of revenue to draw from when working with the stressed budgets caused by immigration costs across our nation, is the income derived from a small but effective tax levied on our unauthorized immigrants and their employers. There was consensus with all we spoke to that unauthorized immigrants and their employers should share in the responsibility of mitigating issues caused by illegal immigration. Our plan is a positive solution and American workers and taxpayers will also benefit.
- We consider it a transitional program. We’ve merely adjusted the taxes, designed a self-enforcing method of compliance, and outlined a couple of dozen problems that the new revenue can resolve. The issues are complex and involve numerous federal, state and local agencies. Our program provides transparency and accountability while raising revenue from those who benefit the most: the workers and their employers.
- The employer will be responsible for paying the combined 10 percent tax on workers’ wages for the duration of the employment in order to keep their special work permit (REALcard) up to date and in force.
- The difficulty in taxing domestic and other cash economy workers is not new. The IRS has always wrestled with this issue in dealing with this almost 50 percent of the unauthorized workforce.
- The opportunity to address this serious problem lies in motivating unauthorized immigrants to participate in the solution by paying the tax and applying for a REALcard (special work permit with benefits) designed to improve their lives so considerably, that it will be worth it for them.
- For immigrants, the benefits made available with the REALcard are unequaled and will draw the cash economy workers “out of the shadows.” The advantages are unprecedented and will inspire these immigrants and employers to pay the minimal tax. Cell phone payment and computer technology make this a simple task today, while it was not possible in years past.
- There are countless reasons why employers — homeowners and businesses — will benefit by embracing the Immigrant Tax Inquiry Group (ITIG) policy:
- It will be legal to hire unauthorized immigrants — no more deportations — no more fines or possible jail time.
- Unauthorized immigrants will gain health benefits and have access to an improved educational system.
- The advantages for employers and employees override any potential obstacles and will foster committed and honest relationships between workers and management.
- The heavy penalties already in place are not currently well enforced because existing policies don’t adequately fund enforcement. Also, since essential services like education and healthcare will be funded, ITIG’s proposed tax will make for healthier, happier employees. Everyone benefits.
- The small tax is reasonable, as employers have traditionally paid unauthorized workers 25 percent less than others, and these workers do jobs others are unwilling to do. The employer still receives a 20 percent wage advantage over other legal workers, including those whose country of origin is the U.S.
- The ITIG policy is a simple process that is easy to implement. Compliance is effortless and will be required, just as with any tax law. It will not be a request, and employers will be subject to serious fines for non-compliance. The workers’ lives will change drastically with the REALcard, so they will refuse to work for non-complying employers. This program also provides much needed funding for enforcement.
- Current law still applies (8 U.S. Code § 1324a) – Unlawful employment of aliens). With this current administration especially, unauthorized immigrants want legal status and working without the permit could lead to deportation. Immigrants will refuse to work with employers who don’t offer the work permit and they may even report them for investigation.
- The third way helps prevent abuse of workers by providing adequate funding for the enforcement of the Immigration and Nationality Act by the Department of Justice’s Immigrant and Employee Rights Section (IER) and our funding will make it possible to administer existing laws that have significant penalties listed by USCIS (U.S. Citizenship and Immigration Services).
- We need to protect American workers. Only if we tax employers and REALcard employees as we would similar employees with withholdings — plus the 5 percent — will the program be fair. As with all unauthorized employees at this time, they would not be able to collect Social Security and Medicare.
- We have trillions of dollars invested in our infrastructure, military, police and fire departments — all of which are very expensive to maintain. This is a small price to pay for living in a safe environment with benefits.
- When the REALcard (special work permit with benefits) is earned by the unauthorized workers paying their 5 percent share of the tax, they will be free and independent. Multiple employers are supported using ITIG’s immigration reform plan. Workers may stay with one employer or change jobs — now with a history of work and a tax record.
- The REALcard allows workers to work for multiple employers with the employee paying the small 5 percent fee and each employer matching the 5 percent, remitted to the IRS. In the event a worker leaves a position, either by being fired or quitting, this program allows them the freedom to switch employers or return to their country of origin.
- An important and desired benefit of the REALcard permit is that it allows unauthorized immigrants to apply for a visa to return to their country of origin and re-enter the United States — a pro-family stance not presently allowed. Our current system is anti-family and encourages human trafficking which is controlled by those who also engage in sex and drug trafficking. These illegal activities would be, at the very least, abated.
- This proposal provides funding, as opposed to existing policies that create unfunded mandates. There is revenue for a host of sectors ranging from infrastructure to education, and healthcare to correctional programs. We estimate that 40 percent of the $210 billion in revenue released into the economy will be labor (teachers, medical staff, construction workers, etc.), and if the average salary including benefits is about $50,000 annually, 1.7 million new American jobs would be created.
- Our current system has created serious backlogs in our courts, as they are flooded with applications from people throughout the world. ITIG’s approach allows for people fleeing dire circumstances (economic, political, environmental, and violence related) to find safe haven while they apply for citizenship. It also provides for those not wanting to become citizens to capture the economic opportunity and return home. Existing immigration policy in the U.S. is anti-family, anti-immigrant, and anti-taxpayer. Self-employment withholding taxes for low-wage earners for Social Security and Medicare allow for benefit returns over and above contributions causing huge deficits if mass citizenship is enacted.
- This program does not include individuals overstaying their visas. The Government Accountability Office (GAO), The Department of Homeland Security (DHS), and Pew Research all agree that we can stabilize our ability to track those immigrants who overstay their visas by strengthening our data collection and biometric systems.
- The ITIG proposal will provide the billions of dollars a year to bolster Homeland Security data collection and biometric identification without any added burden on U.S. taxpayers.
- The most recent overstay figures range upwards from 416,500 in 2015 (DHS Report), but the numbers are also reported to be shrinking. (The [DHS] report indicates that the number of foreign visitors who overstay dwindles over time-Pew). Pew Research has included a summary of the most recent 22-page DHS report on overstays, along with their own data.
- Possibly some will continue, but behaviorist Bruce Morehouse, Ph.D., believes that once the taxes are paid by employers who sponsor the immigrants, a symbiotic relationship will be established and hiring newcomers will be a low priority. Additionally, ITIG’s Vision provides $20 billion for law enforcement and border security.
- With our model, the fear will be removed because programs created in community centers will help educate immigrants, teach English and provide counseling — all of which will help with acculturation and will foster a sense of belonging and acceptance. The advantages of the REALcard (special work permit) will be apparent quickly and most will want to participate.
- The program would replace ITIN returns for the most part, only leaving the higher-earning legitimate returns with W-2 or 1099 documentation.
- E-Verify and biometrics are very powerful tools and strengthen the ITIG proposal just as this proposal provides additional tools for fixing our broken immigration and tax policies, including funding for Homeland Security. E-Verify, biometrics and ITIG’s third way complement each other.
- It does. Immigrants working hard under grueling conditions are instrumental in bringing fresh produce to our tables. Their basic human needs for food, shelter and safety must be met. The wage tax provides for many of their needs, including routine preventive health screenings.
- Farmers will be responsible for seeing that the split tax is paid to the IRS. Subcontractors, if used, will ensure the REALcard documentation is accurate, and workers’ accounts credited. This will also clean up the numerous falsified records created by unauthorized immigrants using others’ Social Security numbers.
- The contractors will be obligated to make sure that the combined 10 percent tax is paid — in coordination with the employer — for labor earnings, including themselves. This would exclude materials and overhead.
- According to surveyed unauthorized immigrants, their greatest wish is to be able to offer better lives to their children — not retirement benefits or voting rights. The educational benefits in our plan will fulfill that dream and improve the U.S. economy with educated, hardworking, committed immigrants.
- The 10-year, renewable transitional plan will improve the lives of immigrants and is designed to bring them respect and dignity, allowing them to assimilate more easily into society, which will eliminate the two-class issue.
- Citizenship needs to be merit-based, and most likely with improved conditions, fewer workers will be interested in becoming citizens. The REALcard represents the ITIG passion that unauthorized immigrants will be able to live here with Respect Equality Accountability and Legality.
Learn More About America’s Needs New, Effective Immigration Policy
The following chart illustrates that retirement benefits beyond contributions for a cash economy worker declaring $9,000 per year (no income taxes paid) can run between $217,494 and $278,082 each. Self-employment taxes are 15.3 percent of wages. Since these workers have no documentation, audited tax returns indicate under-reporting.
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