Key Amendment to S.744 – Do the Amnestied REALLY Need to Pay Back Taxes?

Amidst the swirl of confusion, obscure parliamentary moves, and partisanship, as the Senate Judiciary Committee takes up some 200 proposed amendments to the Gang of Eight's S.744, one vote is likely to be crucial.

That is the one on Hatch Amendment No. 22, which would require illegal aliens seeking amnesty to have actually paid their back taxes before their application for the first stage of the legalization process, that of registered provisional immigrant (RPI).

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The author is Senator Orrin Hatch (R-Utah), a senior member (and a former chair) of the Senate Judiciary Committee, and No. 22 is one of 24 amendments he is proposing, most of which tend to make it easier for employers to hire H-1B nonimmigrant workers (which is a totally different subject).

There are some interesting dynamics at work on No. 22. First, so far the Gang of Eight has been able to beat down amendments to their bill from both the restrictionist and the really open-border types, but the Gang is perhaps vulnerable on this one.

As my colleague Jon Feere pointed out in an earlier blog on this subject, despite much rhetoric about the illegals needing to pay fines and back taxes before they get benefits, the actual text of the bill requires the payment of such taxes only under the rare circumstance in which the aliens had "satisfied any applicable federal tax liability" that had been previously "assessed" by IRS.

For such an assessment to take place the illegals would have had to have filed income tax returns, which is probably not the norm, and the IRS would have had to audit those returns (also unusual), and the IRS would have to have taken the next step of assessing a tax liability. Clearly this trifecta of events happens only rarely and the current provision in S.744 would lead to little, if any, additional tax revenue.

Hatch Amendment No. 22 would change all that, and require payment "of all Federal income and employment [i.e., payroll] taxes owed by such alien for any period in which such alien was present in the United States." And this would have to take place at the start of the legalization process, not when the amnestied alien was, some years later, seeking green card status.

The Gang of Eight, if and when this amendment comes up for a vote in the Judiciary Committee, will either have to surrender on a key piece of their amnesty proposal, or they will have to vote for the current (and now exposed) phony "tax payment" requirement. It is, or should be, squirm time for the Gang.

That's the substantive problem of the Gang, but they are also facing a political quandary, because Sen. Hatch's vote on the bill itself is up for grabs. Will he vote for S.744 – with or without this amendment – or won't he? He is neither a Democrat nor a member of the Gang of Eight, and his vote while perhaps not needed for the passage of the bill itself in the Senate, is badly needed to meet the Gang's goal of a big majority on the Senate floor, which, in turn, would be useful to their efforts to sway Republicans in the House.

So watch what happens to Hatch No. 22.

The Senate Judiciary committee, which met yesterday on another slew of amendments, will meet again 9:30 Monday morning, May 20.

The hearings, incidentally, have so far been relatively civil and even-tempered in tone, and much time has been taken to give each of the proposed amendments a full debate. That atmosphere may relate to the ease with which the Gang, so far, has been able to fight off serious amendments to its handiwork.