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IRS Says New Tax Law Won’t Violate Confidentiality for Aliens With AM-Tax Cheats Bjt

January 13, 1987

WASHINGTON (AP) _ The Internal Revenue Service says it doesn’t expect to violate confidentialit y provisions of the new immigration law when a tax-disclosure requirement for aliens takes effect in 1988.

IRS spokesman Wilson Fadely this week said the revenue agency and the Immigration and Naturalization Service are ″both aware of an apparent conflict″ between the new tax and immigration laws.

The tax law will require aliens seeking permanent residency under the new amnesty program to tell the IRS in 1988 whether they paid taxes the previous three years. Applicants for U.S. passports would also be affected.

The immigration measure specifies that all information submitted to Immigration and Naturalization Service officials under the legalization program must be kept confidential from other agencies and from INS enforcement agents.

″It’s our feeling and the INS’ feeling that the confidentiality would override″ the tax law provision, Fadely said.

But he warned, ″That’s not to say the IRS, in auditing a business, might not come up with something. Normal audit procedures would apply″ to aliens.

Some Hispanic groups believe that any breach of confidentiality would deter people from seeking legalization, but that such fears would lessen considerably if confidentiality is respected.

Under the tax law, failure to file the tax statement without showing ″reasonable cause″ could result in a misdemeanor conviction and a fine of $500 for each failure to provide the information.

More importantly, conviction of either a felony or three misdemeanors could terminate an alien’s legal residency. If caught later in an immigration service’s enforcement raid, he or she would be subject to deportation.

″They could have two traffic tickets already,″ said Rose Briceno, of the National Council of La Raza, a Hispanic lobbying and research organization.

But Ms. Briceno, citing the confidentiality provision, urged eligible aliens to apply for legal status when immigration service legalization offices open May 5.

″When we initially realized the implications of tax program we thought they were greater than now,″ she said.

″Now, we don’t see this to be a great deterrent. We’re relying heavily on the confidentiality provision of the Immigration Act.″

The immigration law will give legal residency to illegal aliens who have lived continuously in the United States since before Jan. 1, 1982. On May 5, the INS will begin accepting applications for temporary residency.

After 18 months on temporary status, aliens must apply for permanent residency during the next one-year period. The tax provision would apply to those taking the latter step.

″The problem is the perception the employer gets,″ said Mario Moreno, associate counsel of the Mexican-American Legal Defense and Educational Fund. ″The employer is pivotal to this whole legalization. The INS is going to stress employment records (to demonstrate eligibility for amnesty).

″Their cooperation is going to be somewhat chilled if they discover they’re going to have to pay back taxes for undocumented individuals they employed. They won’t come forward. But I feel the confidentiality provisions will be protected.″

Rose Briceno said under the confidentiality language of the immigration law, ″Even if you’re not eligible (for amnesty) you don’t have to fear the Internal Revenue Service will come knocking on your door.″

She said that ″some aliens haven’t been paying their taxes, or may have been paying under a false Social Security number. Or they have been paying taxes to an employer, and the employer has been pocketing the money.″

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