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Tennessee Law Review

Document Type

Article

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 Covid-19 global pandemic underscore the socioeconomic disparities of the undocumented immigrant population in America, with legislation like the CARES Act excluding economic relief to undocumented workers, despite their ongoing contributions to the economy and lack of viable legalization options. Meanwhile, DACA recipients, many of whom are classified as essential workers, including frontline healthcare professionals, currently await a more permanent resolution following a favorable Supreme Court ruling on proposed termination of the program. Ideally, reframing taxigration would generate significant political goodwill to aid passage of meaningful immigration reform. Reframing taxigration would aid 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.

Publication Date

2020

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