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How many undocumented immigrants pay taxes in the US annually?
Executive summary
Most recent, widely cited estimates put annual tax payments by undocumented immigrants near $97 billion for 2022 — about $59.4 billion to the federal government and $37.3 billion to state and local governments — based largely on an Institute on Taxation and Economic Policy (ITEP) analysis [1]. Other organizations produce comparable but not identical figures (for example, the American Immigration Council’s $89.8–$89.9 billion estimate for 2023), and reporting notes differences in methods and what counts as “taxes paid” [2] [3].
1. What the headline numbers mean: “Nearly $97 billion” explained
The ITEP study that many outlets and fact-checkers cite estimates that undocumented immigrants paid $96.7 billion in U.S. taxes in 2022, splitting that into $59.4 billion to the federal government and $37.3 billion to state and local governments; ITEP explains its methods and adjustments in appendices to that report [1]. Reuters’ fact-check and other summaries use ITEP’s work when saying undocumented immigrants “can and do” pay taxes and give the same $96.7 billion figure as the baseline [4] [5].
2. Different estimates, different choices: why numbers vary
The American Immigration Council reports a slightly smaller figure — roughly $89.8–$89.9 billion for recent years — because organizations use different datasets, years, and definitions (household-led versus individual contributions, which taxes are included, and whether adjustments for tourists or exported sales taxes are applied) [2] [6] [3]. ITEP explicitly models payroll withholding, income taxes filed with ITINs, sales and excise taxes, and property taxes; methodological differences explain much of the numeric spread [1].
3. Which taxes are included — payroll, income, sales, property
Analysts note undocumented immigrants contribute via payroll taxes withheld from paychecks (Social Security and Medicare), income taxes filed either with ITINs or no SSN, sales and excise taxes when buying goods, and property taxes either directly (homeowners) or indirectly (renters through landlord pass-throughs) [1] [7]. ITEP’s breakdown and state-level mapping show nearly 39% of the total went to state and local governments in 2022 [8] [1].
4. Compliance, withholding, and “paying in but not receiving benefits”
Reporting highlights that many undocumented workers pay payroll taxes that fund Social Security and Medicare but are barred from collecting those benefits, and some pay using fake or borrowed Social Security Numbers — which can result in contributions without entitlement [4] [1]. ITEP and others emphasize that much of the tax revenue comes from taxes that are automatically withheld or harder to avoid — not solely voluntary filings [1] [9].
5. Enforcement, data-sharing, and behavioral effects on future collections
Studies and reporting warn that policies perceived as linking tax data to immigration enforcement (for example, IRS-ICE data sharing discussed in multiple pieces) could reduce tax compliance among undocumented immigrants; Yale’s Budget Lab and ITEP project that a drop in filing or shifts to cash work could materially lower collections, with one estimate suggesting a potential loss of tens of billions if compliance fell sharply [10] [9]. Axios and Yale reporting cite ITEP’s $96.7 billion baseline when modeling downside scenarios [9] [10].
6. Geographic concentration and local impacts
ITEP’s state-level analysis shows concentration in large states — California, Texas, New York, Florida, Illinois, New Jersey — with California alone estimated to get about $8.5 billion a year from undocumented immigrants in state and local taxes [8] [1]. Advocacy groups emphasize that local economies and public services would feel direct impacts if filing or employment patterns changed [2] [11].
7. What reporting does not settle or where sources disagree
Available sources do not mention a single, universally agreed figure for “how many undocumented immigrants pay taxes” as a count of individuals; instead the literature reports aggregate tax dollars paid [1] [2]. Sources also differ on year-to-year totals (2022 vs. 2023) and in whether statistics represent households versus individuals, and those definitional choices produce the variation between the roughly $89.8 billion and $96.7 billion figures cited by different organizations [3] [1] [6].
8. Bottom line for readers: interpret with method in mind
When you see headlines like “undocumented immigrants pay nearly $97 billion,” understand that figure is an ITEP-based estimate for 2022 that aggregates federal, state and local taxes and relies on modeling choices about withholding, the use of ITINs, and sales/property tax adjustments [1]. Alternative, credible estimates cluster in the same general range but differ because they count slightly different items or years [3] [2]. Policymaking or debate about enforcement should account for both the fiscal contributions documented and the vulnerability of those contributions to changes in enforcement and data-sharing policies [9] [10].