Illegal immigrants are a net fiscal drain, meaning they receive more in government services than they pay in taxes. This result is not due to laziness or fraud. Illegal immigrants actually have high rates of work, and they do pay some taxes, including income and payroll taxes. The fundamental reason that illegal immigrants are a net drain is that they have a low average education level, which results in low average earnings and tax payments. It also means a large share qualify for welfare programs, often receiving benefits on behalf of their U.S.-born children. Like their less-educated and low-income U.S.-born counterparts, the tax payments of illegal immigrants do not come close to covering the cost they create.
Key Points • The current surge of illegal immigration is unprecedented. Some 2.7 million inadmissible aliens have been released into the country by the administration since January 2021. There have also been 1.5 million “got-aways” — individuals observed entering illegally but not stopped. Visa overstays also seem to have hit a record in FY 2022.
• We preliminarily estimate that the illegal immigrant population grew to 12.8 million by October of 2023, up 2.6 million since January 2021, when the president took office. This is the net increase in the illegal population based on monthly Census Bureau data, not the number of new arrivals. • Illegal immigrants have a negative fiscal impact -- taxes paid minus benefits received -- primarily because a large share have modest levels of education, resulting in relatively low average incomes and tax payments, along with significant use of means-tested programs and other government services. • Prior research indicates that 69 percent of adult illegal immigrants have no education beyond high school, compared to 35 percent of the U.S.-born. • Using the National Academies’ estimate of immigrants’ net fiscal impact by education level, we estimate that the lifetime fiscal drain (taxes paid minus costs) for each illegal immigrant is about $68,000, although this estimate comes with some caveats. • Illegal immigrants make extensive use of welfare. Based on government data, we estimate that 59 percent of households headed by illegal immigrants use one or more major welfare programs, compared to 39 percent of households headed by the U.S.-born.
• Based on their use rate of major welfare programs, we estimate that illegal immigrants receive $42 billion in benefits, or about 4 percent of the total cost of the cash, Medicaid, food and housing programs examined in our study. However, this is only a rough approximation due to limitations in the data.
• Illegal immigrants can receive welfare on behalf of U.S.-born children. Also, illegal immigrant children can receive school lunch/breakfast and WIC directly. A number of states provide Medicaid to some illegal immigrants, and a few provide SNAP. Several million illegal immigrants also have work authorization (e.g. DACA, TPS and some asylum applicants), allowing receipt of the EITC.
• The high welfare use of illegal immigrant households is not explained by an unwillingness to work. In fact, 94 percent of illegal immigrant households have at least one worker, compared to only 73 percent of U.S.-born households. But the nation’s welfare system is design to help low-wage workers with children, which describes a very large share of illegal immigrant households.
• In addition to consuming welfare, illegal immigration makes significant use of public education. Based on average costs per student, the estimated 4 million children of illegal immigrants in public schools created $68.1 billion in costs in 2019. The vast majority of these children are U.S.-born.
• Use of emergency medical services is another area in which illegal immigrants create significant fiscal costs. Prior research indicates that there are 5.8 million uninsured illegal immigrants in the country in 2019, accounting for a little over one-fifth of the total population without health insurance. The costs of providing care to them likely totals some $7 billion annually.
• Illegal immigrants do pay some taxes. We estimate that illegal immigrants in 2019 paid roughly $5.9 billion in federal income tax, $16.2 billion in Social Security tax and $3.8 billion in Medicaid taxes. However, as the net fiscal drain of $68,000 per person cited above indicates, these taxes are not nearly enough to cover the cost of the services they receive.
• Illegal immigrants do add perhaps $321 billion to the nation’s GDP, but this is not a measure of their tax contributions or the benefits they create for the U.S.-born. Almost all the increa
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