Immigrant Myths and Facts

Myth: Immigrants don't pay taxes

• Immigrants pay taxes, in the form of income, property, sales, and taxes at the federal and state level. As far as income tax payments go, sources vary in their accounts, but a range of studies find that immigrants pay between $90 and $140 billion a year in federal, state, and local taxes. Undocumented immigrants pay income taxes as well, as evidenced by the Social Security Administration's "suspense file" (taxes that cannot be matched to workers' names and social security numbers), which grew by $20 billion between 1990 and 1998.

Myth: Immigrants come here to take welfare

• Immigrants come to work and reunite with family members. Immigrant labor force participation is consistently higher than native-born, and immigrant workers make up a larger share of the U.S. labor force (12.4%) than they do the U.S. population (11.5%). Moreover, the ratio between immigrant use of public benefits and the amount of taxes they pay is consistently favorable to the U.S. In one estimate, immigrants earn about $240 billion a year, pay about $90 billion a year in taxes, and use about $5 billion in public benefits. In another cut of the data, immigrant tax payments total $20 to $30 billion more than the amount of government services they use.

Myth: Immigrants send all their money back to their home countries

• In addition to the consumer spending of immigrant households, immigrants and their businesses contribute $162 billion in tax revenue to U.S. federal, state, and local governments. While it is true that immigrants remit billions of dollars a year to their home countries, this is one of the most targeted and effective forms of direct foreign investment.