Ask The Advisor: June 2011

Ask The Advisor: June 2011

Q:   The best way to help Social Security and Medicare is get people off the rolls who don't belong there — the non-citizens who have come here illegally, and their dependents who have never paid into Social Security.  Wouldn’t there be enough to take care of the seniors we already have if we did?

A:  It’s hard to know because no official government estimates seem to exist.  Just how do illegal workers wind up on Social Security rolls?  In order to get jobs they often provide employers with invalid, fake, or even stolen Social Security numbers.  Employers withhold payroll taxes as required by law and wage reports are sent in to the Social Security Administration (SSA).  If the name and Social Security number reported by employers doesn’t match those in the SSA’s records, the “mismatched reports are placed in an “Earnings Suspense File.

Years later, those earnings records may be accessed when a non-citizen files a claim for Social Security benefits.

Under current law there are two sets of rules for payment of Social Security benefits to immigrants who worked illegally, depending solely on the date in which the individual was assigned their Social Security number by SSA.

Non-citizens who are assigned a Social Security number on or after January 1, 2004, must receive legal work authorization at some point in order to file a claim for Social Security benefits.  If they never get legal work authorization, then they can’t legally file a claim.  If at some point they do receive work authorization, as they would under immigration amnesty proposals, then all of their earnings would be used to determine entitlement for Social Security, even for jobs worked while illegal.  If the worker kept records and could prove the earnings were theirs, the earnings would be re-instated to their authorized Social Security number and used to determine entitlement to benefits.

According to the Congressional Research Service, older noncitizens who were assigned a Social Security number before January 1, 2004, are not required to have ever received authorization to work in the United States at any point to qualify for Social Security benefits.  In other words, those individuals may have worked illegally their entire career and may still file a claim for Social Security, and all their illegal earnings will be counted.

Once an individual becomes entitled to Social Security, other dependents can make claims on their account if all other qualifications are met, even if they never paid into the system.  Here’s a list:
• Spouse (husband or wife)
• Divorced spouse (husband or wife)
• Children (of living wage earner)
• Children (of deceased wage earner)
• Widow(er)
• Widow(er) (divorced spouse)
• Widow(er) (disabled spouse)
• Widow(er) (disabled divorced spouse)
• Mother or father
• Mother or father  (surviving divorced spouse)
• Parent(s)

Does it make sense to allow so many to become entitled based on illegal benefits?  Previous estimates by TSCL and other policy groups project that the cost could add hundreds of billions of dollars to a program that is now in deficit.

Some say that if workers pay into the system, then they should be entitled to benefits.  But TSCL and the overwhelming majority of seniors who have responded to TSCL’s surveys believe that Social Security benefits should not be based on illegal earnings and work credits.  Congress is considering big changes to both Social Security and Medicare that will result in reducing benefits and higher costs for retirees in the future.  TSCL supports measures that would prohibit Social Security from using earnings for jobs worked without legal authorization to be counted towards entitlement to benefits.

Sources:  Social Security Benefits for Noncitizens, Congressional Research Service, February 1, 2008.