(Note that a tax credit is better than an equal-sized deduction, as it directly reduces tax owed, not just taxable income. And the ACTC is refundable, meaning that if the tax owed after application of the ACTC is negative, the filer gets money from the government, i.e. from people who actually pay taxes.)
The ACTC's "older brother" (so to speak) is the Earned Income Tax Credit [EITC]. In 2009, VDARE.com's Edwin Rubenstein dominated the Spring issue of The Social Contract quarterly with a medley of articles under this overarching title: The Earned Income Tax Credit and Illegal Immigration — A Study in Fraud, Abuse, and Liberal Activism.
Rubenstein set the stage in his introduction [PDF] to the medley:
From 1985 to 2006, EITC payments grew from $2.1 billion to $44.4 billion, or by an eye-popping 2,014 percent. Total federal income tax revenues rose by 217 percent over that same period. Similarly, the number of returns claiming the EITC rose from 6.4 million to 23.0 million—an increase of 255 percent—over a period when the total number of federal income tax returns increased by 36 percent.The five components of Rubenstein's report and their links are as follows:
More than one in four immigrant households received the EITC in 2000—nearly twice the 13.2 percent rate of households headed by native Americans. And because immigrant households are larger (primarily because of higher fertility), their EITC payments are larger than those received by native households.
Bottom line: Immigrants accounted for about 13 percent of the U.S. population in 2008 but receive an estimated 26 percent of EITC benefits—about $12 billion.
The EITC program is dominated by fraud. Year after year about one-third of all EITC returns are based on illegal multiple returns, phony Social Security numbers, or claims of non-existent children or spouses. A disproportionate share of illegal-alien households receive the benefit.
The five sections are followed by the transcripts of speeches given on April 14, 2009 (the day before "Tax Day," intentionally!) by Rubenstein ...