IRS citizenship question enforces federal benefit eligibility law

The draft 2026 Form 1040 now carries a plain Yes-or-No question: “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.?”

The Internal Revenue Service posted the draft in late August. About 139 million people filed a 1040 last year.

Before a federal court halted the arrangement, the IRS had already turned over the addresses of 47,000 people to Immigration and Customs Enforcement.

Treasury Secretary Scott Bessent defended the broader policy in an August statement. “Under President Trump, the days of illegal aliens collecting taxpayer-funded benefits are over. The federal law is clear, and Treasury is enforcing it,” he said. “American taxpayers should not be forced to foot the bill for benefits going to those who are barred by law from receiving them.”

That is the core of the conservative case. Federal law already restricts who may receive public benefits. The administration is applying those limits to the refunded portion of four tax credits and collecting the status information needed to do it. Limited government does not mean open-ended payouts. It means the government spends only what the statute allows, for people the statute covers, and stops when the law says stop.

A similar citizenship and work-authorization question appears on the draft of Schedule 3-A, the form used to claim refundable tax credits. The proposal would generally bar people who are not U.S. citizens, U.S. nationals, or qualified aliens from the refundable portions of the Earned Income Tax Credit, the Additional Child Tax Credit, the American Opportunity Tax Credit, and the Adoption Tax Credit. The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 is the statute that sets immigration-based eligibility for federal public benefits; Treasury and the IRS propose treating the refunded portion of those four credits as such a benefit and enforcing the same line.

Treasury and the IRS estimate that 200,000 to 700,000 taxpayers could be affected in tax year 2026. The agencies put the potential savings at up to $2 billion.

About 49 million federal individual returns are expected to claim at least one of the four credits that year. About 24 million of those are expected to involve a refundable portion treated as a federal public benefit. The contrast is stark: nearly 139 million filers on one side of the form, and a far smaller set of claims the government says fall outside the law on the other.

Critics argue the question is unnecessary and dangerous. Nina Olson, executive director of the Center for Taxpayer Rights, said the IRS does not need the information to process returns or the credits. “Your citizenship or residency status is not information the IRS needs to process a return. It’s not even information the IRS needs to process these tax credits,” she said. “The IRS already has Social Security data on taxpayers, as well as ITIN information. It already has what it needs to process a return.” She added: “It’s dragging the IRS into this administration’s immigration policies.”