The immigration reform bill, if passed in the Senate and the House of Representatives in the coming months, would require immigrants seeking citizenship to pay back all owed taxes. While requiring tax payments would give an answer to critics who say that legalization would be a form of amnesty for those who broke U.S. law by entering the country illegally, there is still no way to determine who owes what. There would have to be a secure honor system in place, since many immigrants do not have any paperwork or work history documentation.
A recent report from the Internal Revenue Service on May 8 said that 679 immigrants abandoned U.S. citizenship to forego paying taxes. The IRS gave a list of names in a quarterly report printed in the Federal Register. The report details those individuals who have chosen to renounce their citizenship in the previous three months.
The immigration bill in place from the bipartisan “Gang of Eight” senators leaves the responsibility of figuring out who owes taxes to the IRS, but according to the Washington Post, it doesn’t give specific instructions on how to collect taxes from these individuals. The Post reported that a majority of immigrants seeking U.S. citizenship are paid under the table in cash, meaning they won’t have proof of any past earnings and may not have paid taxes on their current incomes. In some cases, immigrants work under false Social Security numbers, which would only account for withheld payroll taxes.
According to Fox News, Facebook co-founder Eduardo Saverin is one of the 679 immigrants to renounce citizenship, favoring residence in Singapore where there is no capital gains tax. The Senate is adamant about asking immigrants to be honest when it comes to paying taxes in the future when the new laws are in place.