Marketplace: “Undocumented immigrants quietly pay billions into Social Security and receive no benefits.”

by Joseph McKeown


Undocumented immigrants contribute billions of dollars per year to Social Security funds, reports the New American Economy, a bipartisan research and advocacy immigration organization. If all undocumented immigrants were removed from the US there would a tremendous negative impact, both short and long term, on Social Security, explains Monique Morrissey, an economist at the Economic Policy Institute, a Washington D.C.-based think tank. Undocumented immigrants’ contributions to Social Security are especially beneficial since undocumented individuals are not able to later receive benefits. Though Morrissey argues that these contributions are “not good” given that they are made by some of the most vulnerable people in society who are not themselves able to benefit, Abigail Zapote, the Executive Director of the D.C.-based nonprofit coallition, Latinos for Secure Retirement, notes: “The government, the IRS, will never say no to your tax dollars.”

Undocumented immigrants contributed $13 billion into the Social Security funds in 2016 and $3 billion to Medicare, according to New American Economy. An estimated eight million undocumented immigrants work in the country, both on and off the books. Most undocumented immigrants who are working in the US contribute to the payroll tax. Payroll tax is the twelve percent tax taken out of salaried workers’ paychecks, split between employer and employee. It primarily funds Social Security and accounted for eighty-eight percent of the Social Security payouts in 2017. 

But why would millions of undocumented immigrants file tax returns and pay taxes if they could easily not do so? Jose Magaña-Salgado, a managing policy attorney at the Immigrant Legal Resource Center and founder of the Arizona DREAM Act Coalition, says: "First of all, it's the law. And these undocumented immigrants are trying to abide by the law and are fulfilling their civic and financial responsibilities." Additionally, if they ever go before a judge in immigration court it could help their case. One undocumented landscape worker from Central Mexico told The Atlantic that he began paying taxes after learning that it might one day help him stay in the US. Indeed, he was advised that if he filed taxes with an Individual Taxpayer Identification Number, it could help him gain legal status in the US if Congress passes comprehensive immigration reform. He says: “So many people say we are here burdening the country, but we are paying their retirements.”