Reframing Taxigration

67 Pages Posted: 14 Nov 2019 Last revised: 16 Apr 2020

See all articles by Jacqueline Lainez Flanagan

Jacqueline Lainez Flanagan

American University - Washington College of Law; University of the District of Columbia - David A. Clarke School of Law

Date Written: November 5, 2019

Abstract

Tax compliance by undocumented immigrant workers could and should be the architectural centerpiece of immigration reform. Analyzing this premise using broad economic frameworks and examining corresponding mechanisms in U.S. tax and immigration systems, this article seeks to reframe “taxigration” to signify tax filing as a threshold condition to legalization.

“Taxigration” was originally coined by immigration practitioners to signal the intersection between immigration and tax law, most often when individuals in the midst of legalization proceedings file tax returns to supplement their immigration petitions. Conversely, unauthorized workers with no viable path toward legalization must adhere to a tax filing mandate, facilitated by an IRS-issued individual taxpayer identification number (ITIN), but with no correlated immigration benefit. In fact, undocumented workers perceive risk in tax return filing, with an estimated fifty-percent tax compliance rate largely due to fear of detection, detention, and deportation. Further, since the 2016 election, ITIN applications and renewals have reportedly decreased, demonstrating a foreseeable chilling effect on tax filings.

This article explores the benefit of conferring a quasi-protected status upon this class of worker, allotting certain preferences in immigration proceedings directly correlated to tax compliance. It argues political rhetoric surrounding immigration reform must be tempered with appreciable fiscal realities, including the undocumented population’s utility in the workforce and their extensive sales, income, and payroll tax contributions that further governmental interest in GDP growth and U.S. tax base expansion.

Moreover, the devastating effects of the coronavirus global pandemic on medical and economic systems worldwide underscore the socioeconomic disparities within the undocumented immigrant population in America. For example, legislation like the CARES Act excludes economic relief to undocumented workers, despite their ongoing essential contributions to the economy and disregarding their lack of viable legalization options. Ideally, reframing taxigration would generate significant political goodwill to aid passage of meaningful immigration reform and the development of strategic, humane responses to the ongoing influx of new arrivals, benefitting the social and financial security of native citizens and society writ large.

Keywords: tax policy, immigration reform

Suggested Citation

Lainez Flanagan, Jacqueline, Reframing Taxigration (November 5, 2019). Tennessee Law Review, Vol. 87, No. 3, 2020, Available at SSRN: https://ssrn.com/abstract=3481554 or http://dx.doi.org/10.2139/ssrn.3481554

Jacqueline Lainez Flanagan (Contact Author)

American University - Washington College of Law ( email )

4300 Nebraska Ave NW, Washington, DC
Washington, DC 20016
United States

University of the District of Columbia - David A. Clarke School of Law ( email )

4200 Connecticut Ave. NW
Washington, DC 20003
United States

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