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Treasury Proposes Rules Blocking Illegal Immigrants’ Tax Refunds

8/20/2026

Summary

Story summary

Treasury and the IRS proposed regulations on August 19, 2026 to bar illegal immigrants from refundable tax credits.
The rules define refunds as a public benefit limited to citizens, nationals and eligible aliens such as residents, refugees and asylees.
Officials estimate 200,000-700,000 taxpayers would lose refunds, saving $700 million to $2.6 billion.
A hearing on October 14 will consider the rules, which follow U.S. President Donald Trump's February 2025 executive order on benefits for illegal immigrants.

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Story summary

Treasury and the IRS proposed regulations on August 19, 2026 to bar illegal immigrants from refundable tax credits.
The rules define refunds as a public benefit limited to citizens, nationals and eligible aliens such as residents, refugees and asylees.
Officials estimate 200,000-700,000 taxpayers would lose refunds, saving $700 million to $2.6 billion.
A hearing on October 14 will consider the rules, which follow U.S. President Donald Trump's February 2025 executive order on benefits for illegal immigrants.