Why IRS Tax Forms May Soon Ask About Your Citizenship

For the first time ever, taxpayers may have to disclose their citizenship or work authorization status on their tax returns next year, according to IRS drafts of tax forms expected to be used this coming tax season.

The IRS’ latest draft of the 1040 form 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 added question would align with the the Treasury and IRS’ plans announced in August to crack down on refundable individual income tax credits going to non-qualified individuals. {snip}

On Aug. 20, the IRS released a draft of a new schedule 3-A asking taxpayers to self-certify that they’re eligible for the refundable portions of the earned income credit, additional child tax credit, American opportunity credit, and adoption credit.

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Confirming status to receive these refundable tax credits is legal under the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), Treasury and IRS said. PWORA makes clear that these federal benefits are only for U.S. citizens, U.S. nationals and qualified aliens, they said.

Qualified aliens include lawful permanent residents, asylees, refugees, and certain other groups defined or specified under PRWORA, Treasury said. For a joint return, only one spouse must be a U.S. citizen, U.S. national or qualified alien.

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A major concern is how much status information could be accessible to different government bureaus, 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 non-citizen 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. {snip}

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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 don’t meet the qualified status requirements.

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