Gang of Eight splits over tax credits for provisional immigrants

Democratic and Republican members of the Gang of Eight split Monday over a proposal to block millions of immigrants from receiving earned income tax credits, a major cash assistance program.

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Sens. Charles Schumer (D-N.Y.) and Dick Durbin (D-Ill.) broke with Sens. Lindsey Graham (R-S.C.) and Jeff Flake (R-Ariz.) over the issue of giving federal payments to illegal immigrants who would receive temporary legal status under the legislation.

Graham and Flake supported an amendment sponsored by Sen. Jeff Sessions (R-Ala.) to deny earned income tax credits (EITC) to people with Registered Provisional Immigrant Status (RPI).

An estimated 11 million illegal immigrants would gain RPI status under the immigration reform bill pending in the Senate Judiciary Committee.

Schumer and Durbin voted no.

It failed on a party-line vote of 8 to 10.

“EITC is generally available to anyone who has a Social Security number and many are abusing that today we’ve discovered but as these RPIs are established and get a Social Security number, they will qualify it appears under the law for Earned Income Tax Credit,” Sessions said.

Sessions disputed what he called claims by the Gang of Eight that immigrants with temporary legal status would not receive federal benefits.

“This would grant such benefits to millions and be a substantial burden on our country’s finances at a time we’re desperately trying to reduce our deficits,” he said.

An aide to Sessions said “every year billions [of dollars] of tax credits go to illegal immigrants.”

Earned income tax credits comprise the nation’s largest cash assistance program for low-income families after the Supplemental Nutritional Assistance Program, according to the Tax Policy Center.

The center estimates that about 26 million households will receive $60 billion in tax credits this year.

A low-income family with two kids can receive up to $5,372 in credit, sometimes exceeding the amount it pays in taxes.

Schumer called Sessions’s amendment fatally flawed.

“What about those who have RPI status? They’re paying into the system. They’re paying taxes. They’re doing everything like another citizen, and so it’s questionable whether they should be excluded from EITC. It’s a value choice,” said Schumer.

Schumer emphasized that illegal immigrants would not receive tax credits under the bill.

He noted that Sen. John McCain (Ariz.), another Republican member of the Gang of Eight, opposed a similar proposal in 2006.

He cited McCain’s argument at the time that the Sessions amendment would impose an “indefensible double-standard on legalized workers” by making them abide by tax rules but exempting them from credits.

The schism in the gang alarmed proponents of immigration reform.

"It's concerning for what it means for the floor debate," said Marielena Hincapié, executive director of the National Immigration Law Center.

Members of the group have thus far stayed together on most votes to defeat controversial changes to the bill.

This story was updated at 1:02 p.m.

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