BS BULLETIN:

• The Trump administration wants the IRS to add a citizenship and work-authorization question to the 2026 federal income-tax return.
• Filers would certify whether they—and a spouse filing jointly—are U.S. citizens, U.S. nationals or legally authorized to work in the country.
• Treasury says the change would help prevent people who are legally ineligible from receiving refundable tax credits and could save taxpayers as much as $2 billion.

A question Americans are accustomed to seeing on immigration paperwork could soon show up somewhere very different: Their federal income-tax return.

The Trump administration is proposing that taxpayers disclose their citizenship or work-authorization status directly to the IRS beginning with the 2026 Form 1040.

The draft form asks: “At the time you file your return, are you, and your spouse if filing jointly, a U.S. citizen, U.S. national, or an alien lawfully authorized to work in the U.S.?”

Filers would check “Yes” or “No” for themselves and, when applicable, their spouse. A draft Schedule 3-A used in connection with refundable tax credits includes a similar question.

Treasury says the purpose is straightforward: determine whether people receiving refundable federal tax credits are legally eligible for them.

In August, Treasury and the IRS proposed regulations declaring the refundable portions of certain individual tax credits to be federal public benefits governed by eligibility restrictions in the 1996 welfare-reform law. Treasury Secretary Scott Bessent said the administration intends to ensure benefits do not go to people barred by law from receiving them.

Administration officials estimate the changes could save taxpayers as much as $2 billion.

Undocumented immigrants already generally cannot claim the Earned Income Tax Credit because an eligible filer must have a valid Social Security number. The IRS checks those numbers against Social Security Administration records.

But the administration’s broader interpretation of federal benefit restrictions could also affect some immigrants who currently have lawful permission to work in the United States, including certain people with temporary protected status, DACA recipients and some temporary visa holders.

Researchers cited by the Associated Press estimate that hundreds of thousands of people could lose access to the Earned Income Tax Credit and more than a million could be affected by changes involving the Additional Child Tax Credit. Many affected children could themselves be U.S. citizens.

Immigration-policy advocates warn that requiring people to state their status on a tax return could discourage undocumented workers from filing taxes or create information that might later be sought for immigration enforcement. Treasury says the information would remain subject to federal taxpayer privacy and disclosure protections.

The distinction matters because undocumented immigrants do file federal tax returns. The National Taxpayer Advocate found roughly 3.8 million returns filed using Individual Taxpayer Identification Numbers in 2024. Those taxpayers paid approximately $14.4 billion in federal income taxes and another $6.5 billion in Social Security and Medicare taxes, according to data cited by Fox News.

The proposal is not yet a finished rule. Public comments on the related Treasury regulations are due Oct. 5, with a public hearing scheduled for Oct. 14.

MY QUICK TAKE

Forget the screaming for a minute and look at what is actually being proposed.

The IRS sends out refundable taxpayer money. The Trump administration wants people claiming it to state whether they are legally eligible to receive it.

The real fight is going to be over what happens to that answer after the taxpayer checks the box. That is where this gets interesting.

DBS WIRE SOURCES

• Fox News — Trump admin wants tax filers to disclose citizenship status
• U.S. Treasury — Treasury, IRS propose rules on refundable tax-credit eligibility
• IRS — Treasury and IRS proposed regulations
• IRS — Proposed regulation and public-comment deadlines
• Associated Press — Trump proposal would require citizenship disclosure on tax returns