There’s a lot of talk about the immigrant community in the United States, especially Latino immigrants. According to many people, they’re a burden — unfortunately, they don’t appreciate the importance of immigrants for the economy.
The majority of the immigrant community in the United States pay their taxes, contribute significant revenues to the treasury, and prop up the economy.
Regardless, it’s an unfortunate truth that many immigrants now face persecution and tougher conditions. It’s more important than ever that you follow the rules, pay your taxes, and avoid debt.
If you need any help in working toward these goals, we’re here to help. Call us at +1 (704) 243-6333, contact us through our website, or visit us directly at our office at 4801 E Independence Blvd, Charlotte, NC 28212 for legal and professional tax debt advice.
- The Latin population in numbers
- Immigrants and their contribution to the economy
- The aging population in the US
- What Latinos should know before coming to the US
Facts and figures
First, let’s take a look at the demographics of the immigrant population in the US. This helps to gauge how important they are for the economy and how much they contribute.
The Latin population in numbers
The Pew Research Center has found some interesting facts about the immigrant community in the United States:
- The Hispanic immigrant community consists of over 60 million people
- About 37 million of these Hispanics are Mexican (62%)
- Population growth among Dominicans, Venezuelans, and Guatemalans has grown since 2010
- The Venezuelan community in the US grew by 76% in 2017
- 76% of the Hispanic community have American citizenship
- 4 out of 5 Hispanic immigrants have resided in the US for more than 10 years
- 46% have resided there for 20 years or more
- In Los Angeles and Houston, 2 out of every 3 Latinos are Mexican nationals
- Most Latinos are Puerto Rican in Orlando
- In Washington, most Latinos are of Salvadoran origin
- The majority of Hispanics are Cuban in Miami
- The average age of Hispanics in the US is 29
- Argentines earn the highest income per household (nearly $68,000 a year)
- The average Latino household earns $45,000 a year
- The lowest-income Latino community are Hondurans ($41,000 a year)
- 47% of the Hispanic community have their own homes
- 63% of Spaniards own a house
As you can see, it’s hard to imagine the US without its Hispanic communities — they’ve become part of the fabric of the country.
According to Pew, in 2017 the immigrant population reached 45 million, out of a total US population of over 300 million. That means immigrants account for nearly 14% of the total US population in the United States. In 1970, they represented only about 5%.
Of the total number of immigrants living in the United States, 37.4 million possess required documentation, while 10.5 million are undocumented.
State by state breakdown
There are three states in particular with strong Hispanic communities, containing almost 44% of the total Latino population. California has 24%, Texas 11%, and New York 10%.
The ten states with the most immigrants are as follows:
- California: 11 million (mostly in Los San Jose, San Francisco, San Diego, Riverside, and Sacramento)
- Texas: 5 million (mostly found in Dallas and Houston)
- New York State: nearly 5 million (mostly in New York City)
- Florida: 4.2 million (mostly located in Miami and Orlando)
- New Jersey: 2 million
- Illinois: 1.7 million immigrants (mostly in Chicago)
- Massachusetts: 1.1 million (most in Boston)
- Georgia: 1 million immigrants (mostly located in Atlanta)
- Virginia: 1 million immigrants
- Washington: 1 million immigrants (mostly in Seattle)
Meanwhile, these are the states with the least immigrants:
- Vermont: 23, 298
- Montana: 23, 298
- Wyoming: 20,580
The diagram below shows the state and local taxes from undocumented immigrant returns in each state:
Contribution to the economy
According to the Institute for Economic and Fiscal Policy (ITEP), if undocumented immigrants were allowed to work legally, their annual tax contributions would increase by $2.1 billion.
Without the immigrant community, the working population would lose 73.2 million people in 2015, and 165.6 million by 2035. On the other side of the coin, if the immigrant community remains as it is now, the number of working adults will reach 183.2 million by 2035.
This is a clear example of the importance of the immigrant community and proves that the vast majority do pay their taxes. Instead of complaining about immigrants, we should be ensuring there are easy ways for them to pay without doing anything illegal or worrying about being deported.
What does the flow of migration to the United States look like?
In May this year, the President of the United States threatened the Mexican government with increased tariffs and the imposition of tariffs of up to
if they failed to resolve the flow of immigrants from Central America.
Chancellor of International Relations, Marcelo Ebrard, has since reported that Mexico reduced the flow of immigrants into the country by 56%. They restricted immigrants from the south of the border from reaching the US.
The contribution of immigrants is more important than ever thanks to the structural issues the US economy faces.
The number of American workers as a percentage of the total population is shrinking. The number of American workers will fall from around 128.3 million in 2015 to 120.1 million by 2035.
This means that American workers will make up 66% of the population instead of 74%. It might not sound like much, but the demographic change would have a catastrophic impact.
The trend is caused by baby boomers retiring and the low birth rate.
However, as more immigrants enter the United States, they’ll generate earnings that could offset the cost of retirement and the low birth rate.
Without hard-working immigrants, the US would have to find the money and workers elsewhere.
What Latinos should know before coming to the US
Immigrants must inform themselves about the civic duties they’ll be expected to carry out in the US and the problems they might face. This helps them avoid persecution.
Paying taxes every year is one of the most important things an immigrant can do. Firstly, it’s the perfect way to contribute to your community — and you’ll be likely to benefit from your contributions in the future, too.
Besides, bear in mind that the law surrounding migration is always changing. There’s no way to know what the consequence of not paying taxes today could be for your immigration status tomorrow.
Immigration is one of the principal issues for the new US administration.
When it comes to legal immigration into the country, the doors are closing, with the proposal of a point-based immigration system that would favor the most well-off immigrants.
In contrast, the US State Department has capped the admission of refugees to just 18,000 people. That’s a reduction of 40% compared to last year.
Formerly the United States United opened its doors to people in extreme situations, like refugees fleeing from war or humanitarian catastrophes, but now it’s turning its back on them.
Those who have relatives in the United States and still want to enter the country can do so with sponsorship through the Office of Citizenship and Immigration Services (USCIS).
However, on September 28 2019, the government passed the Legal Responsibilities for Sponsors of Foreigners bill. This sets out the requirements of sponsors who want to support their relatives financially so they can enter the US.
Trump has called for increasing obligations and for family members to reimburse the government for support given to immigrants. The sponsor must take responsibility for the expenses of the immigrant.
The sponsor must commit to helping for at least ten years or until the family member obtains citizenship. If the sponsor does not fulfill their commitment, the government can now file charges against them.
Federal agencies are now likely to develop and implement new guidelines.
The FAST Act
In 2015, Obama launched FAST (Fixing America’s Surface Transportation). The act gave the IRS the responsibility of notifying the State Department about taxpayers with “seriously delinquent tax debt.” In some cases, delinquents risked having their passports revoked.
Seriously delinquent tax debt is an unpaid tax bill of $50,000 or more adjusted for inflation.
In 2018, the IRS began to take action, sending unpaid tax bills to the State Department.
Even if you don’t fit into the category, it’s best to pay your tax bill to avoid it happening in the future.
However, there are exemptions for people in bankruptcy, victims of tax theft, and other people undergoing special difficulties, such as those who live in disaster zones or serve in combat zones.
The State Department will notify delinquents in writing if they’re denied their passport or if their current passport is revoked. You can still reclaim your passport if you pay the debt and fill in the extensive paperwork.
Filing for residency
When applying to become a US resident, it’s important to have a stable income, proof of your heritage, and the money to cover your application costs.
Having debt, a poor credit history or a recent bankruptcy will negatively affect your application.
In the worst-case scenario, you could face deportation.
One instance of “bad debt” is medical debt paid for by Medicaid. If you’ve received treatment for a medical emergency at a US hospital then returned to your country without paying the debt, you could even lose your tourist visa.
Further examples are pensions and child support. To apply for child support, at least one parent must reside in the United States for it to be legal.
However, some countries, like Mexico, have signed agreements with US entities to allow parents based in the US to claim child support.
If you’re worried about damaging your residency application but you need financial help, consider sources like the infant and pregnant aid program (WIC), coupons and food stamps (like Calfresh), housing support, or daycare centers (like Headstar), and Medicaid for minors.
It’s clear that the US economy relies on immigrants and will struggle to cater for its aging population without them. Yet in many ways, immigrants are treated as second-class citizens — so you need to tread carefully. Especially if you’re an undocumented matter.
Remember that reporting your earrings to the IRS is a serious matter and flouting the rules could result in deportation.
If you’re applying for legal status in the country and owe taxes to the federal government, the government could reject your application. However, once you comply, you can turn your fate around.
If you need some help in fulfilling your tax duties, visit the IRS website. Alternatively, contact us or call us on +1 (704) 243-6333 to find out how we can support you.