What are the latest credible estimates of fiscal costs of undocumented immigrants to federal, state, and local budgets?
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Executive summary
Estimates of the fiscal cost of undocumented immigrants vary wildly depending on the author and methodology: recent advocacy and think‑tank reports produce figures from roughly $96.7 billion per year in tax contributions by undocumented immigrants (ITEP) to claims of $150–182 billion per year in net costs to taxpayers (FAIR, House Budget Committee summaries) [1] [2] [3] [4]. Academic and policy groups produce still different metrics — e.g., projections of large deportation costs or lifetime per‑immigrant fiscal burdens — meaning there is no single “credible” number agreed across these sources [5] [6] [7] [8].
1. Numbers you’re likely to see in headlines — and where they come from
Two recurring headline figures appear in the recent reporting you supplied: $96.7 billion in taxes paid by undocumented immigrants in 2022 (Institute on Taxation and Economic Policy, ITEP) and reports claiming roughly $150–182 billion in taxpayer costs annually from unauthorized immigration (Federation for American Immigration Reform, FAIR; House Budget Committee summaries) [1] [2] [4] [3]. ITEP’s number measures tax contributions, and FAIR’s and committee briefings aim to capture gross public expenditures; the two are not alternate estimates of the same variable [1] [2] [3].
2. Different questions produce different answers — revenue vs. cost vs. net fiscal impact
Analyses split along three distinct questions: how much undocumented people pay in taxes (revenue), how much public services and benefits cost (gross expenditures), and the net fiscal impact (revenues minus expenditures over various time windows). ITEP reports tax payments of $96.7 billion in 2022 and models higher collections if work authorization were universal (an added $40.2 billion in one scenario) [1]. FAIR and some congressional materials report large gross cost tallies (FAIR reports $151–182 billion depending on the dataset and population assumed) [2] [4]. These are not directly comparable without aligning definitions [1] [2].
3. Methodological drivers that explain the wide spread
Differences stem from scope (federal only vs. federal+state+local), time horizon (annual vs. lifetime vs. 10‑year budget window), inclusion of indirect or enforcement costs (e.g., deportation, border operations), and population assumptions (estimates of how many undocumented people and whether their U.S.‑born children are counted) [2] [5] [4] [3]. For example, mass‑deportation modeling from the Penn Wharton Budget Model and advocacy groups finds very large additional spending needs and economic losses tied to removal operations and border enforcement — a different question than annual service use [5] [6].
4. Estimates about removing undocumented immigrants are costly in different ways
Reports modeling large‑scale removals show removal and enforcement themselves create major fiscal impacts. The American Immigration Council and Penn Wharton modeling both show billions per year in enforcement/deportation costs and wide macroeconomic effects; Penn Wharton projects billions more in required outlays over a 10‑year window even after some spending reductions [6] [5]. Those costs complicate arguments that deportation is an obvious fiscal saver.
5. Single‑number claims often reflect advocacy priors
Several of the largest headline totals come from advocacy organizations or partisan committee releases (FAIR, House Budget Committee, White House fact sheet cites FAIR), or ideologically aligned think tanks (Manhattan Institute, AEI) that use particular assumptions about population size, benefit eligibility, and fiscal windows to reach large net‑cost claims [2] [4] [9] [7]. Those sources make explicit choices — for example, counting broad categories of dependents or assuming very large unauthorized populations — that drive totals higher [4] [2].
6. What neutral reporting says and what’s missing from these sources
Journalistic and university reporting cited here emphasizes complexity: local costs are often concentrated and immediate, especially for school and emergency health care, while federal fiscal effects depend on tax contributions and long‑run benefit eligibility; neither side of the debate has a single uncontested answer [10] [11]. Available sources do not mention a single consensus “net” fiscal number agreed by neutral academic consensus within the provided set (not found in current reporting).
7. How to read these numbers if you need to cite one
If you need an evidence‑based single figure, choose the estimate that matches the question you’re asking (tax revenue, gross public spending, or net fiscal impact) and cite its assumptions. For tax contributions cite ITEP’s $96.7 billion and its modeled increase with work authorization [1]. For gross annual costs cite FAIR/House committee figures (~$150–182 billion) but note their population and scope assumptions and advocacy origin [2] [4] [3]. For deportation/enforcement costs cite Penn Wharton or American Immigration Council analyses showing large additional outlays and macro losses [5] [6].
Limitations: these sources disagree on definitions, populations, and timeframes; many of the largest numbers originate with advocacy or partisan entities and rely on assumptions that produce higher totals [2] [4] [3].