Sen. John Cornyn, R-Texas, and Rep. Sam Johnson, R-Texas, have re-introduced a bill aimed at preventing fraud in the provision of Individual Taxpayer Identification Numbers to undocumented immigrants.
The ITIN Reform Act comes in response to a 2012 report from the Treasury Inspector General for Tax Administration report on the IRS’s handling of ITIN applications. The IRS provides ITINs to individuals who are ineligible for Social Security numbers such as undocumented immigrants. The ITIN can be used to qualify for refundable tax credits.
The 2012 report from TIGTA found that IRS supervisors urged employees to ignore potential fraud in a program that reviews and verifies applications for ITINs (see IRS Discouraged Employees from Identifying Fraudulent ITIN Applications). Cornyn and Johnson originally introduced their bill in 2014.
“Everything we hear about the IRS lately points to abuse, discrimination, and waste,” Cornyn said in a statement. “Passing this bill would eliminate one avenue for tax fraud and save American taxpayers billions of dollars.”
The bill would put safeguards in place to prevent fraud in the ITIN application process. It would also require TIGTA to conduct regular audits to ensure the IRS is protecting taxpayer dollars.
The ITIN Reform Act would require first-time applicants to submit an ITIN application in-person at a Taxpayer Assistance Center or diplomatic consulate. Currently, applicants can submit their applications by mail or through a third party. Individuals seeking an ITIN would need to provide original documentation establishing their identity and foreign status. In addition, new ITINs would have a 5-year time limit with an option to renew while existing ITINS would be time limited.
“This bill is part of my ongoing effort to root out waste, fraud, and abuse,” said Johnson. “The ITIN Reform Act makes commonsense reforms that hard-working American taxpayers want, need, and deserve. I thank my colleague and fellow Texan, Senator Cornyn, for leading the effort in the Senate.”
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