Both documented and undocumented immigrants pay taxes. The Congressional Budget Office estimates that approximately 11 million undocumented immigrants live in the United States. According to the New American Economy, immigrants paid $458.7 billion in taxes in 2018. Of that, $458.7 billion undocumented immigrants paid $31.9 in taxes. The Institute on Taxation & Economic Policy estimates that as of 2017, undocumented immigrants paid $11.74 billion a year in state and local taxes (including income taxes, property taxes, and sales and excise taxes). Undocumented immigrants pay various types of taxes, including:

  1. Sales taxes;
  2. Property taxes;
  3. Income taxes;
  4. Social security & Medicare; and
  5. State and local taxes.

Payment of these taxes amounts to billions of dollars in taxes paid each year by undocumented immigrants.

Sales Taxes

A few states in the nation do not assess a sales tax; however, in most states, when an undocumented immigrant makes a purchase, they pay sales tax. In its March 2017 report, the Institute on Taxation and Economic Policy estimated that in 2014, undocumented immigrants paid approximately $7,025,296,000 billion in sales taxes.

Property Taxes

Depending on the state, 21%-45% of undocumented immigrants own a home. Most states, counties, and municipalities across the U.S. assess property taxes. Immigrants who own real property pay those property taxes, and immigrants who rent contribute to the tax basis by paying rent. Property taxes support the school system, and other municipal public works.

The Institute on Taxation and Economic Policy estimates that undocumented immigrants paid $3,583,429,000 in property taxes in 2014.

Income Taxes

When an undocumented immigrant does not have a social security number, they may apply for an “Individual Tax Identification Number” from the Internal Revenue Service (IRS).  According to the IRS’ “Taxpayer Advocate” in 2015, 4.4 million ITIN filers paid $23.6 billion in taxes, including $5.5 billion in payroll and Medicare taxes. According to another document from the IRS, undocumented workers pay over $9 billion in annual payroll taxes. The Institute on Taxation and Economic Policy estimates that undocumented immigrants paid $1,131,236,000 in income and excise taxes in 2014.

State & Local Taxes

Undocumented immigrants also pay state, local, and county taxes when they dine out, pump gas, and otherwise participate in the community.   According to the Institute on Taxation and Economic Policy, undocumented immigrants pay $11,739,961,000 per year in state and local taxes.

Federal Taxes

Social Security & Medicare

Undocumented immigrants are ineligible to receive social security benefits and may receive Medicare in limited circumstances.  For undocumented immigrants who have taxes withdrawal from their paychecks, this means that they pay FICA taxes for benefits that they will likely never receive. According to the Social Security Administration, for the year 2010, undocumented workers paid approximately $12 billion into the social security system.

Annual Federal Tax Returns

The IRS estimates that 6 million undocumented immigrants file federal tax returns each year.

Many families are ‘blended’ and may have one U.S. citizen parent, one or more undocumented parents, and U.S. citizen and foreign-born children. According to the IRS’ Taxpayer Advocate, for years 2011-2014, an average of 4.6 million people filed Form 1040 that included an ITIN for the primary or secondary filer, or a dependent.

Table 1: State and Local Taxes Paid By Undocumented Immigrants 1
State Income Taxes Property Taxes Sales Taxes Total   Undocumented Immigrants by State

(Approximate) 2

Alabama $10,471,000 $6,530,000 $45,311,000 $62,312,000 65,000
Alaska No Income Tax $2,167,000 $1,877,000 $4,043,000 10,000
Arizona $16,388,000 $52,954,000 $144,232,000 $213,574,000 275,000
Arkansas $7,384,000 $8,002,000 $47,382,000 $62,767,000 65,000
California $157,883,000 $1,070,833,000 $1,970,679,000 $3,199,394,000 2,000,000
Colorado $21,429,000 $35,883,000 $82,211,000 $139,524,000 180,000
Connecticut $15,551,000 $50,682,000 $58,469,000 $124,701,000 140,000
Delaware $4,662,000 $4,076,000 $4,794,000 $13,532,000 30,000
District of Columbia $6,647,000 $5,651,000 $19,467,000 $31,765,000 25,000
Florida No Income Tax $134,722,586 $463,955,000 $598,677,875 825,000
Georgia $62,447,000 $74,856,000 $214,416,000 $351,718,000 375,000
Hawaii $6,521,000 $5,251,000 $20,571,000 $32,343,000 45,000
Idaho $2,802,000 $8,754,000 $17,056,000 $28,613,000 35,000
Illinois $95,945,000 $311,009,000 $351,926,000 $758,881,000 425,000
Indiana $19,802,000 $17,001,000 $55,396,000 $92,200,000 110,000
Iowa $5,974,000 $9,420,000 $21,333,000 $36,728,000 50,000
Kansas $6,473,000 $18,322,000 $43,049,000 $67,843,000 75,000
Kentucky $11,282,000 $5,211,000 $20,136,000 $36,629,000 40,000
Louisiana $8,536,000 $7,244,000 $52,210,000 $67,991,000 70,000
Maine $681,000 $1,081,000 $2,605,000 $4,367,000 <5,000
Maryland $77,970,000 $85,561,000 $168,717,000 $332,248,000 250,000
Massachusetts $42,471,000 $60,313,000 $81,821,000 $184,605,000 275,000
Michigan $18,499,000 $21,495,000 $46,699,000 $86,692,000 110,000
Minnesota $14,796,000 $18,684,000 $49,713,000 $83,192,000 85,000
Mississippi $2,796,000 $2,708,000 $17,180,000 $22,684,000 20,000
Missouri $8,771,000 $11,466,000 $28,660,000 $48,897,000 60,000
Montana $144,000 $237,000 $168,000 $548,000 <5,000
Nebraska $4,778,000 $13,465,000 $21,557,000 $39,800,000 55,000
Nevada No Income Tax $20,271,000 $65,830,000 $86,101,000 210,000
New Hampshire No Income Tax $5,207,000 $1,987,000 $7,236,000 15,000
New Jersey $49,148,000 $272,322,000 $265,945,000 $587,415,000 450,000
New Mexico $3,956,000 $13,689,000 $50,098,000 $67,743,000 55,000
New York $182,675,000 $354,686,000 $564,962,000 $1,102,323,000 650,000
North Carolina $59,671,000 $54,568,000 $163,163,000 $277,402,000 325,000
North Dakota $123,000 $507,000 $2,214,000 $2,844,000 5,000
Ohio $15,649,000 $20,059,000 $47,540,000 $83,247,000 95,000
Oklahoma $10,935,000 $16,183,000 $57,647,000 $84,765,000 90,000
Oregon $29,831,000 $35,652,000 $15,292,000 $80,775,000 100,000
Pennsylvania $34,440,000 $35,887,000 $64,545,000 $134,872,000 190,000
Rhode Island $3,887,000 $9,652,000 $17,615,000 $31,154,000 35,000
South Carolina $10,606,000 $13,288,000 $43,859,000 $67,753,000 90,000
South Dakota No Income Tax $1,036,000 $4,302,000 $5,338,000 5,000
Tennessee No Income Tax $16,260,000 $91,169,000 $107,465,000 130,000
Texas No Income Tax $493,636,000 $1,067,260,000 $1,560,896,000 1,600,000
Utah $13,189,000 $15,718,000 $40,863,000 $69,770,000 110,000
Vermont $326,000 $1,094,000 $1,515,000 $2,936,000 <5,000
Virginia $71,310,000 $63,142,000 $121,514,000 $255,965,000 275,000
Washington No Income Tax $73,577,000 $243,047,000 $316,624,000 250,000
West Virginia $1,080,000 $501,000 $3,531,000 $5,112,000 <5,000
Wisconsin $13,230,000 $22,195,000 $36,367,000 $71,792,000 75,000
Wyoming No Income Tax $723,000 $3,442,000 $4,165,000 5,000

1 Methodology for ITEP Data

The estimates for income, property, and sales taxes paid by undocumented immigrants, by state, were aggregated from the Institute on Taxation & Economic Policy.   In compiling its data, the ITEP uses “five main data points” in their methodology:

  1. The estimated undocumented immigrant population of each state;
  2. The average size of undocumented immigrant families;
  3. A range of undocumented immigrant family’s annual incomes: ITEP adjusts this income downwards by 10% to account for monies sent abroad;
  4. Estimated numbers of undocumented immigrants owning homes;
  5. Estimated “effective tax rates” for sales, income, and property taxes, that are paid by low-moderate income families by state.

Additional assumptions were made in ITEP’s methodology:

  • That undocumented immigrants, like all people, pay sales taxes when they purchase goods and services;
  • That 50% of undocumented immigrants pay income taxes;
  • That undocumented immigrants, like all others, pay property taxes; ITEP also accounts for renters contributing to property tax revenues.

Ten States Receiving the Most State & Local Taxes Paid by Undocumented Immigrants

Six Largest Undocumented Populations by State: 2017

2 Methodology for Pew Research Center

Estimates of the Undocumented Immigrant populations by state are from the Pew Research Center. The Pew Research Center aggregated its data from U.S. census records, government surveys, birth records, school enrollment data, tax data, along with Mexican census records. After that data is complied, Pew combines that data with legal U.S. immigrant admissions, and other “demographic data” (death records) to determine how many immigrants continue to reside in the U.S.

Lastly, they subtract the legal immigrant population from that number to obtain the estimated undocumented immigrant population.