Entitlement Impact with Mass Citizenship

Self-employment taxes for low wage earners will drain our Social Security and Medicare funds if mass citizenship is allowed. U.S. tax policies and tax fraud plague America’s existing immigrant tax system. The tax reform suggested in the Immigrant Tax Inquiry Group (ITIG) model would alleviate this dysfunction and improve society in general and the lives of our immigrants significantly.

The average undocumented cash-economy worker earns approximately $15,000 per year. If mass citizenship were permitted, he or she could declare only $9,000 on their tax return, pay no income taxes, but will still be eligible to receive excessive Social Security and Medicare payments when they retire.  The charts below clearly illustrate the dramatic effect undocumented would have on our economy if mass citizenship is accepted at this time.

Contributions of 15.3% Self-employment tax on $9,000 per year wages 

Years Work Self-employment tax paid Benefits (18 years) Deficit Ratio of Benefits Received over Tax Paid
10 $13,770 $231,264 $217,494 17:1
20 $27,540 $275,328 $247,788 10:1
30 $41,310 $319,392 $278,082 8:1
The average non-cash economy undocumented immigrants using others Social Security numbers earns approximately $22,500 per year.

Contributions of 15.3% Self-employment tax on $22,500 per year wages

Years Work Self-employment tax paid Benefits (18 years) Deficit Ratio of Benefits Received over Tax Paid
10 $34,425 $275,112 $240,687 8:1
20 $68,850 $355,896 $287,047 5:1
30 $103,275 $436,680 $333,405 4:1

Funding Social Security and Medicare for Low Wage Earners

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