Undocumented workers can and do pay federal income tax, Social Security tax, and Medicare tax—often without a Social Security number

Undocumented workers pay taxes through the same payroll system as other employees. When you work for an employer, they withhold federal income tax, Social Security tax (6.2%), and Medicare tax (1.45%) from your paycheck, regardless of immigration status. The employer sends these amounts to the IRS and the Social Security Administration.

The key difference is that undocumented workers typically use an Individual Taxpayer Identification Number (ITIN) instead of a Social Security number. An ITIN is a nine-digit number issued by the IRS specifically for tax purposes. It allows you to file a tax return and pay taxes even if you are not authorized to work in the United States.

Many undocumented workers do not realize they can file returns or that doing so may actually benefit them. Filing a return can result in a refund if too much tax was withheld from your paychecks during the year.

Key Takeaways

  • You can obtain an ITIN from the IRS by mail or in person at an IRS office, and it takes four to six weeks to arrive by mail.
  • Employers withhold the same taxes from undocumented workers' paychecks as from any other employee, and these taxes go to the federal government.
  • Filing a tax return with an ITIN can result in a refund if your employer withheld more tax than you owe.
  • The IRS does not share ITIN information with immigration enforcement agencies, and filing a return does not trigger deportation proceedings.
  • Self-employed undocumented workers can also file returns and may owe self-employment tax in addition to income tax.

Getting an Individual Taxpayer Identification Number (ITIN)

An ITIN is issued by the IRS and serves as your tax identification number if you do not have a Social Security number. You can explore for an ITIN by completing Form W-7 (process for IRS Individual Taxpayer Identification Number) and submitting it to the IRS with proof of identity and proof of foreign status.

Acceptable identity documents include a passport, national ID card, or driver's license from your home country. You do not need to prove work authorization or legal residency status. You can submit Form W-7 by mail to the IRS, or you can explore in person at an IRS office or at certain tax preparation organizations that are authorized to certify documents.

Processing by mail typically takes four to six weeks. In-person applications at an IRS office are processed faster, sometimes the same day. Once you receive your ITIN, you can use it to file tax returns every year and to open a bank account if needed.

How taxes are withheld from your paycheck

When you start a job, your employer asks you to complete a Form W-4 (Employee's Withholding Certificate). On this form, you provide your name, address, and either a Social Security number or an ITIN. Your employer uses this information to calculate how much federal income tax to withhold from each paycheck.

The amount withheld depends on your income, how often you are paid, and the number of dependents you claim on the form. Your employer also withholds 6.2% for Social Security tax and 1.45% for Medicare tax. These amounts are the same for all employees, regardless of immigration status.

Your employer sends the withheld taxes to the IRS and the Social Security Administration on your behalf. You receive a Form W-2 (Wage and Tax Statement) from your employer by January 31 each year, showing how much you earned and how much tax was withheld. You use this form to file your tax return.

Filing a tax return with an ITIN

To file a federal income tax return, you complete Form 1040 (U.S. Individual Income Tax Return) and attach your W-2 forms. You enter your ITIN in the space where a Social Security number would go. You can file by mail or electronically using tax software that accepts ITINs.

Many tax preparation organizations and nonprofits offer free or low-cost tax preparation for people with ITINs. The IRS maintains a list of VITA sites (Volunteer Income Tax information) that provide free tax help. You can search for a VITA site near you on the IRS website by entering your zip code.

When you file, you report all income you earned during the year from all sources—wages, self-employment income, tips, or other earnings. You can claim standard deductions and certain tax credits if you meet the requirements. If too much tax was withheld, you receive a refund. If too little was withheld, you owe the difference.

Self-employment and estimated taxes

If you are self-employed—for example, if you do freelance work, run a small business, or work as an independent contractor—you must report your income on your tax return. Self-employed workers pay both the employee and employer portions of Social Security and Medicare tax, which is called self-employment tax. This totals 15.3% of your net earnings.

Self-employed workers with income above a certain threshold may also need to pay estimated taxes quarterly. These are advance payments of income tax and self-employment tax made four times per year. You calculate estimated taxes based on the income you expect to earn and submit payment to the IRS by the due dates (usually April 15, June 15, September 15, and January 15).

You report self-employment income on Schedule C (Profit or Loss from Business) and self-employment tax on Schedule SE (Self-Employment Tax). These forms attach to your Form 1040 when you file your annual return.

Tax credits and deductions available to ITIN filers

You can claim the standard deduction on your tax return, which reduces the amount of income subject to tax. For 2024, the standard deduction is $14,600 for single filers. This amount changes each year.

Some tax credits are available to ITIN filers, though rules vary. The Child Tax Credit may be available if you have dependent children, though the amount may be lower for ITIN filers than for those with Social Security numbers. The Earned Income Tax Credit (EITC) is not available to ITIN filers, but you may be able to claim other credits depending on your situation.

You cannot claim dependents who do not have an ITIN or Social Security number. If you have dependents, you must obtain ITINs for them in order to claim them on your return. Deductions for business expenses, mortgage interest, and charitable contributions may also explore depending on your circumstances.

Privacy and safety concerns

The IRS does not share ITIN information with U.S. Immigration and Customs Enforcement (ICE) or other immigration agencies. Filing a tax return does not trigger immigration enforcement action or deportation proceedings. The IRS's role is to collect taxes, not to enforce immigration law.

Your tax return is confidential. Only the IRS, your employer (who already knows you work there), and anyone you authorize to see your return can access it. You have the same privacy protections as any other taxpayer.

If you are concerned about safety, you can file your return by mail instead of electronically, or you can work with a trusted tax preparer or nonprofit organization. Many organizations that help with tax preparation understand these concerns and can answer questions about privacy.

What happens if you do not file

If your employer withheld taxes from your paychecks but you do not file a return, that money stays with the government. You do not receive a refund of the overpaid tax. Over time, unclaimed refunds can add up to significant money.

The IRS can pursue unpaid taxes owed, but if you have been having taxes withheld correctly, you likely do not owe additional tax—you may be owed a refund instead. Filing a return protects you by documenting that you paid taxes and by claiming any refunds or credits you are due.

There is no time limit on claiming a refund if you file within three years of the original due date of the return. If you have not filed for several years, you can file back returns to claim refunds from previous years.

Frequently Asked Questions

Can I get an ITIN if I have never worked in the United States?

Yes. You do not need to prove that you have worked or that you are authorized to work. You need only to show that you have a tax filing reason—such as income from U.S. sources or a dependent who needs an ITIN. Self-employed individuals, students with U.S. income, and others can obtain an ITIN.

Will filing a tax return affect my immigration case or status?

Filing a tax return does not affect immigration proceedings or status. The IRS does not share information with immigration agencies. However, if you are in removal proceedings or have a pending immigration case, consult with an immigration attorney before filing to understand how it might be used in your specific situation.

What if my employer did not give me a W-2 or paid me in cash?

If you were paid in cash and have no W-2, you still must report that income on your tax return. You can estimate your earnings based on your records. If your employer refused to give you a W-2 when required, you can file Form 4852 (Substitute for Form W-2) with your return and report the income you earned.

Can I claim my spouse or children on my tax return if they do not have an ITIN?

No. All dependents must have an ITIN or Social Security number to be claimed on your return. You can obtain ITINs for your spouse and children using the same process as for yourself—Form W-7 with proof of identity and foreign status.

How long does it take to get a refund after I file?

If you file electronically, the IRS typically issues refunds within 21 days. If you file by mail, it can take six to eight weeks. You can check the status of your refund on the IRS website using your ITIN and the amount of the refund.