Just a few reminders on tax day: immigrants, including undocumented immigrants, pay billions of dollars in taxes each year. Payroll taxes from undocumented immigrants pay billions into Social Security and Medicare, keeping these funds solvent for longer, even though they can never receive either. Specifically:
Immigrants—citizens, legal permanent residents, and undocumented immigrants—pay income taxes. A lot of income taxes.
“Both documented and undocumented immigrants pay more into public benefit programs than they take out. According to Institute on Taxation and Economic Policy, undocumented immigrants contribute an estimated $11.74 billion to state and local economies each year. However, undocumented immigrants are not eligible for many of the federal or state benefits that their tax dollars help fund.
“Additionally, a few states have completed studies demonstrating that immigrants pay more in taxes than they receive in government services and benefits. A study in Arizona found that the state’s immigrants generate $2.4 billion in tax revenue per year, which more than offsets the $1.4 billion in their use of benefit programs. Another study in Florida estimated that, on a per capita basis, immigrants in the state pay nearly $1,500 more in taxes per capita than they receive in public benefits.”
Undocumented immigrants also prop up Social Security. Both official reports by the Social Security Administration and think tank analyses show the contributions of undocumented immigrants to Social Security and Medicare:
“If all undocumented immigrants were deported today, next year’s Social Security trust funds would have approximately $13 billion less for benefit payouts. It’s a considerable loss of dollars, especially when it’s projected that the Social Security funds will be depleted by 2034.
“According to New American Economy, undocumented immigrants contributed $13 billion into the Social Security funds in 2016 and $3 billion to Medicare. Three years prior, the Chief Actuary of the Social Security Administration, Stephen Goss, wrote a report that estimated undocumented immigrants contributed $12 billion into Social Security.”
On average, immigrants (citizens and legal permanent residents and undocumented workers) are younger than the U.S.-born population. That also helps support Social Security:
“The more working-age people you have to support each retiree, the easier it will be for working-age people to both care for old folks and enjoy rising living standards themselves. So what we have in the U.S. is, simply, even though fertility is down here over time – fewer kids per woman than it used to be – we’re still significantly more fertile than the rest of the world – or at least more than Germany, Italy, Japan and China.
“And second, we have, as you said earlier, a lot more immigrants. If you can’t grow your own, you can import them. ….
“But I think the important thing is, it’s not only the number of people that matters; it’s their age. The more working people, the easier it is to care for the large and growing number of retirees – the more people paying taxes for Social Security, Medicare and so forth – and the more workers available to care for the growing number of elderly. And that’s where immigration plays a really important role.”