What's the Opposite of Tax Evasion?

Katherine Mangu-Ward | April 16, 2007

Illegal immigrants are showing up in droves this year to pay their taxes. Several of the amnesty proposals under consideration in Congress link amnesty and taxes--requiring payment of back taxes before amnesty can be granted, for example.

The New York Times explains how people without Social Security numbers can still be law-abiding taxpayers:

Illegal immigrants do not have Social Security numbers, but the Internal Revenue Service allows them to file taxes by assigning applicants individual taxpayer identification numbers. The numbers were introduced in 1996 to encourage noncitizens with United States income, including foreign investors, to file returns. It is generally accepted that most of the 11 million numbers issued since then have gone to illegal immigrants.

The Washington Post opts for practical analysis paired with a warm and fuzzy take on the story:

"Having their taxes done is a benefit to them. . . . Generally, when something opens for immigration, they will ask if you have tax returns for the past two or three years. Some of them ask for proof if they have been in the country for 10 years. What better proof is there than having tax returns for 10 years? That says a lot," [tax consultant Hank] Azais said....

Josefina Gutierrez Calucho, 37, a self-employed cleaning woman originally from Bolivia, said she has paid her taxes for the past six years to comply with the law and to support the public education of her 10-year-old daughter, Talia.

As her accountant was filing out her forms, the Dale City resident smiled and said, "I like this country."

The I.R.S. is charmingly ecumenical about the whole thing: “We want your money whether you are here legally or not and whether you earned it legally or not,” said Mark W. Everson, the commissioner of the I.R.S.

Earlier, I wrote about how some illegals are also using their ITIN's to open bank accounts, perhaps to save some cash for their tax bill, or to deposit their refund check once it comes in.

Comments

|4.16.07 @ 4:18PM|#

What's the Opposite of Tax Evasion?

TaxInvasion?

TallDave|4.16.07 @ 4:19PM|#

The only way to solve the illegal immigration problem is to fix Mexico.

In the meantime, people who actually pay their taxes should certainly be given preference in being made legal citizens.

shecky|4.16.07 @ 4:24PM|#

Isn't it sad that one of the most rational government entities regarding the wacky US immigration policy would be the one in charge of taking money.

squarooticus|4.16.07 @ 4:30PM|#

That's avoision.

|4.16.07 @ 4:32PM|#

What's the opposite of Tax Evasion?

Sucking up?

|4.16.07 @ 4:36PM|#

The only way to solve the illegal immigration problem is to fix Mexico.

Once Mexico is completely emptied of Mexicans, the fix should be relatively easy.

Brian Sorgatz|4.16.07 @ 4:39PM|#

"Charmingly ecumenical." I admire clever turns of phrase, and that is one.

|4.16.07 @ 4:42PM|#

The only way to solve the illegal immigration problem is to fix Mexico.

The first step would be to annex Mexico, then work our way down to the Panama canal.

Seitz|4.16.07 @ 4:44PM|#

"We want your money whether you are here legally or not and whether you earned it legally or not,"

In other words, if we can't prosecute you for selling drugs/guns/sex illegally, at least we can prosecute you for not reporting the income from your illegal sales of drugs/guns/sex.

Goldwater Conservative|4.16.07 @ 4:55PM|#

This is stupid. Liberals and Leftists love thier taxes, but I'm sick of hearing people bitch about war, poverty, imperialism, and not actually noticing that it all goes back to tax revenue. I'd love to see what "imperialism" looked like under voluntary taxation.

|4.16.07 @ 5:10PM|#

I'd love to see what "imperialism" looked like under voluntary taxation.

So would I, because I suspect that without taxation (and without fiat currency), building an empire was so much more difficult (or nearly impossible) than today.

|4.16.07 @ 5:11PM|#

The only way to solve the illegal immigration problem is to fix Mexico.

Why? Is it broken?

thoreau|4.16.07 @ 5:14PM|#

Um, while empires of the past did have taxation, they certainly didn't have fiat currency. They generally used metallic currency, and somehow they managed to build empires and sustain them, sometimes for centuries.

Dave B.|4.16.07 @ 5:18PM|#

I'd love to see what "imperialism" looked like under voluntary taxation.

I think it looked like the Crusades.

|4.16.07 @ 5:29PM|#

I find myself agreeing with the IRS.

What's the weather like in Hell today? Unseasonably cold?

|4.16.07 @ 5:52PM|#

Agreeing how? That, no matter what you do or how you do it, if you come into money, the government gets to take a large portion of it? Pffft.

I do agree that, if you're working here, you should pay taxes whether you're legal or not.

TLB|4.16.07 @ 6:04PM|#

Now, for the "Reason"ing that Reason can't do:

One part of our government is profiting from IllegalActivity, activity forbidden by the same set of laws that created the IRS. And, people tend to favor activities that bring in money, meaning that one or more parts of our government might disfavor enforcement of our laws.

If, say, the PostalService is able to balance their books by shipping cobras, they might tend to try to prevent enforcement of laws against shipping cobras.

Likewise, those parts of the government that profit from IllegalActivity might lobby internally to allow that IllegalActivity to continue.

What I've described above is GovernmentCorruption. While Reason's writers obviously don't have the sheer brain power to figure it out, they are in effect supporting GovernmentCorruption.

Likewise with PrivateCompanies such as banks profiting from IllegalActivity.

In fact, the BushAdministration fought to allow banks to profit from IllegalActivity by stopping a bill that would forbid them from taking Mexico's MickeyMouseID card which is a marker that the bearer is almost certainly an IllegalAlien.

|4.16.07 @ 6:16PM|#

I'd love to see what "imperialism" looked like under voluntary taxation.

I think it looked like the Crusades.

Juh?
Wasn't that the age of fiefdoms, serfs, etc.?
Tithing was requisite if one wanted to go to heaven...

|4.16.07 @ 6:21PM|#

So, SolitaryLunatic, we now know about those who profit form illegal immigration.

How bout telling us who's harmed by it.

And, no, got to keep out the dirty stinkin greasers doesn't count.

|4.16.07 @ 6:40PM|#

Quite a bit of imperialism was done off the tax books. The Dutch had an East Indian Company, as did the English. The Company of Scotland famously took a bath on the attempt to plant a colony on the Isthmus at Darien. The Darien scheme's failure was one of the proximate causes of the 1717 Act of Union. The French had their Mississippi Company, masterminded by a Scot, John Law. That one exploded, too.

Several U.S. states, notably Pennsylvania, started out as proprietary operations.

The merchant companies weren't bastions of free enterprise. They were created by royal charter, and the sovereign or the state were often heavy investors, or took a kickback for the monopoly granted. At the outset, these companies raked it in, as the sole source of natural resources extracted from areas previously outside the world trade system. As they became destinations for colonists they took on the features of pseudo-governments, along with the attendant expenses. When this became a losing proposition, lands administered by these companies were eventually converted into colonies directly under the authority of the government.

"Fixing" Mexico by annexing it is, I presume, a joke. Anybody want to price extending the "equal protection of the laws" as it would apply to transfer payments? We couldn't afford to annex Canada, as far as that goes.

The IRS "profiting" from illegal activity is nothing new. Gamblers are required to report all their winnings, even those from illegal wagers. The same is true for income from the illegal drug trade. It is a lovely Catch-22, whereby your 5th Amendment right against self-incrimination doesn't apply unless you exert it at the appropriate places on your tax return.

I only wish out resident Lunatic were as Solitary as his odd posting style implies.

Kevin

TLB|4.16.07 @ 7:17PM|#

Regarding the harm associated with IllegalImmigration, I'll keep it at 10:

1. IncreasedCrime
2. Increased PoliticalPower for RacialDemagogues (GilCedillo, AntonioVillaraigosa, etc. etc.)
3. Increased PoliticalPower for RacialPowerGroups (NationalCouncil of TheRace, etc.)
4. Increased PoliticalCorruption.
5. Increased PoliticalPower inside the U.S. for the MexicanGovernment.
6. IllegalAliens directly (TheHijackers) and indirectly (got DriversLicenses for TheHijackers) involved in 911.
7. Skewing of CongressionalDistricting.
8. Increased public costs for PublicSchools, etc.
9. Shafting AmericanCitizens (some IllegalAliens can get CollegeDiscounts not available to some AmericanCitizens).
10. Decreasing the valuation of AmericanCitizenship.

|4.16.07 @ 7:20PM|#

10. Decreasing the valuation of AmericanCitizenship.

Damn! I should have sold in 1999.

|4.16.07 @ 7:21PM|#

Part of me is glad illegal aliens are paying taxes. That must be the evil cynical part of me, because the libertarian part has a bumper sticker across his chest saying "No Taxes!". But dammit, why should illegal aliens get a free ride when legal immigrants and citizens have to keep paying Uncle Sam's extortion?

thoreau|4.16.07 @ 7:25PM|#

So, Lonewacko, would you say that the best way to keep the government honest would be if immigration enforcement prioritizes those who do pay taxes? Just to cancel out the incentives facing the government when some illegals pay taxes and others don't?

|4.16.07 @ 7:27PM|#

the libertarian part has a bumper sticker across his chest saying "No Taxes!"

Hmmm.

The libertarian part of me -- well, the libertarian whole of me -- has a bumper sticker across his chest saying "No Protectionist Immigration Laws!"

Were there no such thing as illegal immigration, tax avoidance by illegal immigrants would not be an issue.

|4.16.07 @ 7:29PM|#

Um, while empires of the past did have taxation, they certainly didn't have fiat currency.

No, they did it by stealing from conquered people. But it was much more difficult still.

|4.16.07 @ 7:32PM|#

Regarding the harm associated with IllegalImmigration, I'll keep it at 10:

TLB, all of those reasons are indictments against the welfare-state, not immigrants. Please choose your quarrels better.

5. Increased PoliticalPower inside the U.S. for the MexicanGovernment.

Really? Gee, then nobody has told president Calderon yet... Get real.

|4.16.07 @ 7:37PM|#

7. Skewing of CongressionalDistricting.

I think that's my favorite.
It might be the nuttiest.

Mike Laursen|4.16.07 @ 8:01PM|#

TLB, why are you writing phrases like "increased crime" and "racial power groups" as "IncreasedCrime" and "RacialPowerGroups"? It is DamnedAnnoying.

|4.16.07 @ 8:10PM|#

Hmmm...next theme day for Hit & Run:

Write like LoneWackoDay!

It could be BigFun!

Nope, it's already lost its luster.

|4.16.07 @ 8:17PM|#

It is DamnedAnnoying.

I think it is SomewhatEndearing.

Today\'s read \'n\' learn link|4.16.07 @ 8:47PM|#

News flash: repealing the welfare state is not as difficult as repealing gravity, but it's close.

As for #7, IllegalAliens count towards CongressionalRepresentation, meaning that they have an ImpactOnDistricting. More at the link, or here:

house.gov/list/speech/ca50_bilbray/03082007.html

TLB|4.16.07 @ 8:52PM|#

Try these instead:

fairus.org/site/PageServer?pagename=iic_immigrationissuecenters5cbd

house.gov/list/press/mt00_rehberg/062305_IllegalAliens.html

newsmax.com/archives/articles/2003/10/24/102835.shtml

cis.org/articles/2003/back1403coverage.html

VM|4.16.07 @ 9:29PM|#

Is lonewacko the one sans pinky fingers, or is it one of the other wackjobs?

/kicks self, yet again. starting to like it.

GO AWAY!!!! BATIN!!!!

|4.16.07 @ 9:54PM|#

The first step would be to annex Mexico, then work our way down to the Panama canal.

Hmmmmmmmmm...didn't we already try that a couple of times?

|4.16.07 @ 10:21PM|#

"Fixing" Mexico by annexing it is, I presume, a joke. Anybody want to price extending the "equal protection of the laws" as it would apply to transfer payments? We couldn't afford to annex Canada, as far as that goes.

It is, and it isn't. The fundamental problem with Mexico is the overall lack of rule of law combined with political and police corruption. This hinders business development and exacerbates poverty. So, poor people with no options cross the border looking for work in the US.

I occasionally joke that we could take all the illegals here in the US, test them, and then train the ones that show promise. Make sure they bilingual and fully understand the "american way". Then we make Mexico a US territory and put all the newly trained illegals in positions power running the new territory. In 50 years, when it stabilizes, parts of Mexico could apply for statehood.

It's as good a pipe dream as building thousands of miles of fence.

|4.16.07 @ 10:50PM|#

This is a pipe dream I've had before. I contend it is no nuttier than building a fence. Which is no nuttier than digging a new, inland sea between the US and Mexico.

|4.16.07 @ 10:54PM|#

Now, we've all read our Reason and we all know that ILLEGAL IMMIGRANTS DO NOT GET FREE PUBLIC SERVICES.

We just known that for sure and certain. Which is why we read quickly over this one.

Josefina Gutierrez Calucho, 37, a self-employed cleaning woman originally from Bolivia, said she has paid her taxes for the past six years to comply with the law and to support the public education of her 10-year-old daughter, Talia.

It is impossible that any illegal immigrants would take public services without also feeling morally obligated to also pay taxes.

Illegal immigrants are so much more moral than US citizens, I haven't figured out yet what's wrong with the rest of the world.

Maybe we should be digging that inland sea so's to keep the idiots in, rather than keep the honest and upright people out.

|4.16.07 @ 11:15PM|#

SolitaryLunatic,

I told you, "got to keep out the dirty stinkin greasers" doesn't count.

So don't give us ten variations on that refrain.

|4.16.07 @ 11:18PM|#

OK, I haven't read all the comments, but knowing this board, I think I know where most of the people fall. On the side of open borders and the like. I have read a few and if I'm wrong, hey, sue me.

Personally this sickens me.

I think there is often a disconnect between ideal libertarianism and anarchism (I can't spell or use dictionary.com).

I have no problem with completely open borders. I don't. But if we are going to have open borders and apply our standards of life to every single person in the entire world. Then everyone else in the entire world MUST play by the same rules.

I think one of the biggest problems with most libertarian ideology is that it is not applied evenly.

In society, everyone must agree to play by the same rules. If not playing by the same rules were not a requirement, then why not extend the rights we have as humans to the rest of the animal kingdom.

After all, why can't a monkey, lion, or slug enjoy the same rights we do. Why? Because those of us that live in this society all agree to live by a lot of the same rules an regulations.

Also, as libertarian, we must be above the fray in saying that just because I believe it, it must be law. If you take this interpretation to its logical conclusion of what libertarianism means, then it is perfectly alright for people who follow Islam to beat and rape their women, so long as it's private and doesn't cost the state anything. But I don't think that there is one person who thinks that would be a good idea. But for some reason when it comes to immigration, we throw up our hands and say, hey, this is our theory and we cannot move away from it.

Anyway, I need to go. I think I stirred up enough troule, so please discuss.

|4.16.07 @ 11:19PM|#

Now, we've all read our Reason and we all know that ILLEGAL IMMIGRANTS DO NOT GET FREE PUBLIC SERVICES.

We've all read our Reason and we all know that illegal immigrants do not get welfare.

We also know -- from reading Reason or not -- why compulsory publicly funded education exists: Because nominally educated people presumably make better citizens and better participants in the economy.

There is nothing about the legality or illegality of a person's immigration status that affects this reasoning except the probability the person would move back to their home country after their education.

Since the big whine is that illegal immigrants stay in the US, I'm having trouble figuring out why one would care that illegal immigrants don't fully pay for their children's educations any more than one would care that impoverished citizens don't fully pay for their children's educations.

|4.16.07 @ 11:28PM|#

I have no problem with completely open borders. I don't. But if we are going to have open borders and apply our standards of life to every single person in the entire world. Then everyone else in the entire world MUST play by the same rules.

Do you feel the same way about trade?

After all, it is pretty much universally accepted by libertarians that unilaterally dropping trade barriers is an unqualified improvement over restricted trade.

Why is the movement of labor, rather than capital or goods, any different?

|4.16.07 @ 11:32PM|#

"IllegalAliens directly (TheHijackers) and indirectly (got DriversLicenses for TheHijackers) involved in 911."

Oh, I get it, if we only kept out the dirty stinkin greasers the towers would still be standing.

Give me a fucking brake!!!

|4.16.07 @ 11:37PM|#

"The fundamental problem with Mexico is the overall lack of rule of law combined with political and police corruption."

The only problem is the lack of protection of property rights. We already have too many laws. Bad law, in Mexico, the same way as in the US, breeds corruption. It is not like Mexicans are specially succeptible to corruption.


"This hinders business development and exacerbates poverty."

Again, this is true when it comes to protection of property rights. Land ownership is barely protected in Mexico, not even a right by Constitutional standards but a privilege granted by the State. With this, people hurry up in stripping their land of everything they can, before some group of locusts (land grabbers)under some Union leader, backed up by your local politician, take it.


"So, poor people with no options cross the border looking for work in the US."

Mexicans do not have the monopoly of migration to the US, you know. Even so, not all Mexicans that migrate from poorer parts of Mexico go to the US. They tend to go to the big industrial cities inside Mexico, like Mexico City, Monterrey and Guadalajara.

|4.16.07 @ 11:42PM|#

"After all, it is pretty much universally accepted by libertarians that unilaterally dropping trade barriers is an unqualified improvement over restricted trade."

That is right. It is better for the country that opens its borders regardless of how much it exports.


"Why is the movement of labor, rather than capital or goods, any different?"

It is not. In fact, the free movement of labour would SOLVE the problem of migrants staying in the country. Most Latin American workers would rather work in the US but return to their country after the season is over. With the lunatic laws and border restrictions in place, they are encouraged to stay as much as they can, because if they try to return to their country, they may not be able to return to work. Immigration restrictions ENCOURAGE people to stay and use the "free" services, rather than the other way around.

Guy Montag|4.16.07 @ 11:50PM|#

As her accountant was filing out her forms, the Dale City resident smiled and said, "I like this country."

I have been filing federal income tax since around 1980 and have NEVER had them done by an Accountant. Know why? Because Accountants are not cheap and I am.

I paid over $26,000 in mortgage interest in 2006 and I still don't have an accountant for my taxes.

Perhaps I should "become" illegal so I can make enough to need an Accountant and not mind paying for one.

|4.17.07 @ 12:48AM|#

Francisco Torres,

Immigration restrictions ENCOURAGE people to stay and use the "free" services, rather than the other way around.

I suspect you are right about this one. But I am equally sure that:

a) nobody is ever going to get rid of the welfare state here in the USA, so long as the USA may exist, and

b) corruption is not going away in Mexico, so long as Mexico may exist, and

c) the real cost of building a barrier along the Mexican border -- a border that would actually work -- is quite simply prohibitive.

Which is why I'm sure that this whole problem won't be going away in my lifetime or yours.

You're right about corruption too. The US is not immune to it. I see it creeping into our system ever so persistently.

|4.17.07 @ 12:48AM|#

Guy,

You're just going to have to start making people offers they can't refuse. :) You know, like "I'm gonna offer you the opportunity to buy these carbon credits I got here in my brief case. Once you see it, you'll know this is an offer you can't refuse."

There's GOT to be Mexicans coming over the border who don't have any carbon credits with them.

|4.17.07 @ 12:58AM|#

Tseren,

I think one of the biggest problems with most libertarian ideology is that it is not applied evenly.

I think you're right, but this is a quite complex and fairly abstract problem you're getting at here. I don't think very many people actually understand the concept.

The fundamental issue is that society -- the state -- civilization -- whatever phrase you want to use, and whatever extent you want to give it -- in any case, "it" has boundaries.

Beyond those boundaries lies The Jungle. You simply cannot deal with The Jungle on the same terms that you would have people deal with one and other on the inside. Indeed, our whole concept of ethics as it is normally used, is meaningless outside the context of "it".


But when you combine immigration with this concept, things get really slippery, really fast. It still leaves me with very mixed feelings when I think about it.

Nonetheless, in the end I tend to come down on the side of open immigration for humanitarian reasons. But we do pay a price for it, and I still have misgivings.

In some ways, for example, big pools of cheap labor can slow down technological/economic advancement. If the labor wasn't there, then we'd figure out how to automate and that would probably drive the whole economy up another notch. Just for one little example.

|4.17.07 @ 2:50AM|#

The conservatives calling for a wall along the Mexican border are half right -- we should definitely let the wall be built -- but by the Mexican government, in a desperate attempt to prevent their citizens from fleeing to our country, when libertarian politicians (now there's an oxymoron) open the border to anyone with job skills and no history of violent criminal activity.

Libertreee|4.17.07 @ 1:17PM|#

Only the Goldwater Conservative got the answer almost right--

Immigrants, unless they have a green card, who come to the US to work and do not legally reside for more than 7 months a year, are NON_RESIDENT ALIENS under the US tax code. Under that code, they are required to pay US INCOME TAX.

There is no such requirement for State Citizens, and for RESIDENT ALIENS...

Look at Title 26, Subchapter N, section 861, sources of income from within and without the US.

The problem is not how many immigrants are paying income taxes they owe. The problem is how many Americans are paying income taxes they
DO NOT OWE....

|4.17.07 @ 1:45PM|#

The problem is not how many immigrants are paying income taxes they owe. The problem is how many Americans are paying income taxes they DO NOT OWE....

Perhaps in your rush to get to Title 26, Subtitle A, Chapter 1, Subchapter N, Part I, Section 861, you might have skipped over Title 26, Subtitle A, Chapter 1, Subchapter A, Part I, Section 1...

You know, the section that has a bunch of clauses that look like...

There is hereby imposed on the taxable income of every head of a household (as defined in section 2(b)) a tax determined in accordance with the following table: ...

...where the class of taxpayer runs through all the possibilities listed as checkboxes on top of the 1040 you didn't fill out.

I know that, as a number, 861 is much more fun than 1. But no one said the tax code was fun.