Treasury Cracks Down on Immigrant Tax Credits

Treasury Secretary Scott Bessent has announced new rules limiting immigrant tax credits for DACA and visa holders. The proposal targets four major tax credits, including the Child Tax Credit, Earned Income Tax Credit, Adoption Tax Credit, and American Opportunity Tax Credit.

Under the proposed changes, only U.S. citizens and certain non-citizens, such as green-card holders, asylum seekers, and refugees, would be eligible for the refundable part of these credits. The non-refundable share, which reduces tax liability, would still be available to anyone who meets the requirements.

The restrictions affect immigrants without legal status but also catch some people with valid U.S. work authorization, including temporary work-visa holders and foreign students with work permits.

Brandon DeBot, policy director for NYU Law's Tax Law Center, argues that the administration is 'attempting to override both the clear rules Congress has set for tax credit eligibility and decades of administrative practice.'