For the first time, taxpayers may have to disclose their citizenship or work authorization status on their tax returns next year, according to IRS drafts of forms expected for the coming tax season.
The latest draft of Form 1040 includes a yes-or-no question for filers and spouses: “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 question would align with Treasury and IRS plans announced in August to crack down on refundable individual income tax credits going to people who do not qualify. About 139 million people filed a Form 1040 last year, IRS data show.
On Aug. 20, the IRS released a draft of a new Schedule 3-A asking taxpayers to self-certify that they are eligible for the refundable portions of the earned income credit, additional child tax credit, American opportunity credit and adoption credit.
“As I suspected, the new question is tied to the new Schedule 3-A,” said Richard Pon, a certified public accountant in San Francisco. The questions are “almost identical,” he said.
Is This Legal?
Confirming status to receive these refundable tax credits is legal under the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, Treasury and the IRS said. The law says these federal benefits are for U.S. citizens, U.S. nationals and qualified aliens.
Qualified aliens include lawful permanent residents, asylees, refugees and certain other groups defined or specified under the law, Treasury said. For a joint return, only one spouse must be a U.S. citizen, U.S. national or qualified alien.
A taxpayer who is not qualified to receive the refundable portion can still claim any portion of an affected credit for which the taxpayer otherwise qualifies to offset income tax liability, Treasury said.
“This isn’t political. It’s the law,” said Yenisley Diaz, an enrolled IRS agent and owner of Chico Taxes in South Carolina. “That’s how the 1996 law was written about federal benefits, but it’s not really been implemented until now.”
Pon agreed. “So even if there is a public backlash, I think the final version of Form 1040 would keep the question,” he said.
What Are the Concerns?
A major concern is how much status information could be accessible to different government agencies, experts said.
“Concerns include potential data sharing with other federal agencies, particularly after a recent court ruling questioned IRS disclosure practices to ICE,” wrote Ching-luen (Moya) Wu, a tax professional, on LinkedIn. “Critics also fear it could deter noncitizen filers, potentially undermining tax compliance.”
Earlier this month, an appeals court affirmed a lower-court decision stopping the IRS from disclosing taxpayer information related to government immigration actions. The IRS was sued in February 2025 over its decision to provide the Department of Government Efficiency access to protected tax return data.
Other analysts fear the new question could prevent immigrants in the United States under temporary protected status or Deferred Action for Childhood Arrivals from collecting certain tax breaks.
How Many People Could the Question Affect?
Treasury and IRS estimated that, of the 24 million taxpayers claiming these refundable tax credits, between 200,000 and 700,000 taxpayers — 0.8% to 2.8% — would likely be ineligible to receive them for tax year 2026 because they do not meet the qualified-status requirements.
Based on an estimated average of these benefits during the 2026 tax season of $3,656, Treasury and IRS forecast that the government would save $700 million to $2.6 billion by not paying disallowed credits.
However, the nonprofit and nonpartisan Pew Research Center suggested that the number of people affected could be greater than Treasury and IRS estimate.
What Should Immigrants Do?
File their taxes and be honest, Diaz said.
“A lot of people received these benefits for 30 years who weren’t supposed to, but now, it’s not going to happen anymore,” she said.
Diaz and others warned people not to lie because tax returns are signed government documents, so lying could amount to perjury. Perjury could prevent someone from being granted U.S. naturalization because of the “good moral character” requirement.
The intersection of tax compliance and immigration law is becoming stricter, wrote the Immigration Professional Association, a California law corporation specializing in immigration. Because Form 1040 is signed under penalty of perjury, consult a qualified professional if you are unsure how a new requirement affects your filing.
This article originally appeared on USA TODAY. Reporting by Medora Lee, USA TODAY. USA TODAY Network via Reuters Connect.
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