WRAL Investigates

NC tax expert: 'Stop and investigate' illegal immigrants' tax refunds

Posted November 20, 2012

WRAL Investigates

— Less than a month after the WRAL Investigates team reported on a tax fraud scheme involving suspected illegal immigrants, a Wake Forest certified public accountant has come forward to say she has questioned some of her own clients' suspicious behavior.

The tax fraud scheme is a $4 billion problem across the U.S. that involves suspected illegal immigrants getting billions of dollars in tax credits for children who don't live in America, or don’t even exist, according to the Treasury Inspector General for Tax Administration.

“It's just ridiculous how easy it is for people to qualify for these credits,” said CPA Nancy Dawkins.

U.S. citizens’ Social Security numbers are used when processing tax returns. Illegal immigrants, or people in the U.S. on work visas, use an Individual Taxpayer Identification Number, or ITIN.

The WRAL Investigates team tracked audits warning the IRS for years about child tax credits and easy-to-get ITINs that open the door for illegal immigrants to defraud the system. When the credits became refundable, the claims exploded.

Dawkins says she has questioned clients who changed their taxpayer ID numbers and their children's names to work the system. “That's a big clue. If you don't know the names of your children, maybe these aren't your children,” Dawkins said.

Following WRAL’s stories last month, two Charlotte women – Candida Figueroa and Cathy Cisneros – pleaded guilty in a $5-million tax fraud scheme. Agents confiscated hundreds of refund checks, lists of Hispanic names, a box of Mexican birth certificates and tax returns sent out to people linked to falsified documents.

“They want to send out these refunds so fast. Stop and investigate before you hand it out. Does this make sense?” Dawkins said. Taxes NC tax expert: 'Stop and investigate' illegal immigrants' tax refunds

Lawmakers and the IRS need to make the credit only a deduction, not a refund, according to Dawkins. They also need to make only children in the U.S. eligible and step up monitoring to verify claims are legitimate.

“We're spending an enormous amount of money on fraud. Let's use our money efficiently and really help the people that need it,” Dawkins said.

The IRS may get direction from Congress soon. There are two proposed bills. One would tighten the background checks on ITIN returns, and the other would eliminate the child tax credit for non-citizens.

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  • driverkid3 Nov 21, 2012

    WooHoo2You::::You putting “according to” at the beginning of a sentence does not make something true.

    It certainly does not make it false either. You know what the truth is, but you will insist with your dying breath that these illegals need to be protected and catered to. Sorry, it doesn't work like that.

  • Disabled Vet Nov 21, 2012

    Why are non citizens getting any tax breaks/credits anyway? If you are not a citizen, then you deserve nothing from our government!

  • 101jackson101 Nov 21, 2012

    I really do hope that WRAL stays on this story, this type of thing has gone on for years and people just let it go, good job WRAL and thanks for confronting a problem many seem to shy away from.

  • superman Nov 21, 2012

    Discontinue the tax credits as well as the deduction for children for everyone. Even Americana citizens. In its place tax each child. People who cant afford children and have to depend on government welfare dont get my sympathy. The income tax exemption you get for children is just another form of government welfare. Society doesnt benefit from your children. There are already more people than there are jobs. There should be a government mandate limiting the number of children. The more childen you have--the less taxes you pay. Something is wrong with that.

  • WooHoo2You Nov 21, 2012

    Lopo,

    -@ WooHoo2You Hello earth to woohoo2you, you should know employees fill out their W2's but you can't question them and they also talk about it. And yes, i do speak Spanish.(and yes I was in HR)

    You also claimed you know how they filled their taxes….is that typically part of a Human Resources job description or just more fantasy?

    -But you are right about same day registration, I shouldn't sterotype and I apologize, sometime I just figure you can't speak English and havre no ID they might be illegal.

    Now they “might” be illegal…again, were you behind them in line at the polling place? How did you know they did not have ID if ID is not required to vote? Did you hire them without ID? You do realize that is illegal?

    - But when at work when they also brag about voting, it kind of narrows it down.

    I have yet to hear anyone ever “brag” about voting.

    -please quit making excuses for them when it is happening under our noses.

    I have not made excuses for anyone.

  • ezLikeSundayMorning Nov 21, 2012

    I'm pretty permissive and think there should be clear paths to citizenship, especially the Dream Act, but I find it hard to defend the logic of refundable tax credits for non-citizens.

    Society benefits from our children. Sure the tax credit helps families get by, but it also ancourages and rewards us for making more citizens to benefit the country in the future.

  • lopo Nov 21, 2012

    @ WooHoo2You
    Hello earth to woohoo2you, you should know employees fill out their W2's but you can't question them and they also talk about it. And yes, i do speak Spanish.(and yes I was in HR)

    But you are right about same day registration, I shouldn't sterotype and I apologize, sometime I just figure you can't speak English and havre no ID they might be illegal. But when at work when they also brag about voting, it kind of narrows it down.
    I'm not going to insult anyone but it is happening and our state is a safe haven for illegals.

    Only thing we ask is too enforce the law, please quit making excuses for them when it is happening under our noses.

  • NCHighlander Nov 21, 2012

    More WIC and American flag food stamp cards for them. Undocumented Democrats need your tax money.

  • Scubagirl Nov 21, 2012

    This shouldn't even need to be said. If the IRS would investigate, bunches of money would sure stay and not get given away. Illegal 'residents' should have NO tax credits-----THEY ARE ILLEGAL. If the child doesn't live IN THE HOME no credit......

  • ifcdirector Nov 21, 2012

    Not going to happen.

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