IRS leader defends rule to bar illegal immigrants from refundable tax credits

A proposed regulation from the Treasury and the Internal Revenue Service would label the refundable segments of four major tax credits as federal public benefits, thereby excluding illegal immigrants from receiving them. The rule targets the child tax credit, earned income tax credit, American opportunity tax credit and adoption tax credit, but only the portion that exceeds a taxpayer's liability and results in a refund.

This classification relies on the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, which generally prohibits illegal immigrants from accessing federal public benefits. Frank Bisignano, serving as both Social Security Administration Commissioner and IRS chief, defended the proposal, saying it aligns with the principle that tax credits should benefit citizens and lawful residents. He noted that despite some opposition, the rationale behind the rule is clear and appropriate. The regulation remains pending and could take effect if finalized.