S.268 - Saving American Workers’ Benefits Act of 2025 (119th Congress)
Summary
The Saving American Workers' Benefits Act of 2025 (S.268) aims to amend the Internal Revenue Code of 1986. It seeks to require taxpayers and their qualifying children to possess a valid Social Security number (SSN) authorized for employment purposes in order to claim the child tax credit and the earned income tax credit. The bill was introduced in the Senate on January 28, 2025, and referred to the Committee on Finance.
The proposed legislation stipulates that the SSN must be issued to a citizen of the United States or under specific provisions of the Social Security Act. It also mandates that the SSN must be issued before the tax return due date for the relevant taxable year.
The changes would apply to taxable years beginning after December 31, 2025.
Expected Effects
The primary effect of this bill would be to restrict access to the child tax credit and earned income tax credit to individuals with SSNs authorized for employment. This could reduce improper payments and ensure that only eligible individuals receive these benefits.
It could also create additional hurdles for low-income families who may have difficulty obtaining or verifying their SSNs. The bill also amends the Internal Revenue Code to allow for math error authority when a social security number is missing or incorrect.
Potential Benefits
- Reduced Improper Payments: By requiring valid SSNs for employment, the bill aims to reduce fraudulent claims and improper payments of the child tax credit and earned income tax credit.
- Increased Fiscal Responsibility: Reducing improper payments can lead to better allocation of government resources and potentially lower budget deficits.
- Fairness to Taxpayers: Ensures that only eligible individuals receive tax benefits, promoting fairness among taxpayers.
- Program Integrity: Strengthens the integrity of the child tax credit and earned income tax credit programs by verifying eligibility.
- Incentivizes Legal Employment: May encourage individuals to seek legal employment to qualify for these tax credits.
Most Benefited Areas:
Potential Disadvantages
- Disproportionate Impact on Low-Income Families: Some low-income families may face challenges in obtaining or verifying SSNs, potentially losing access to crucial tax credits.
- Increased Administrative Burden: Taxpayers and the IRS may face increased administrative burdens in verifying SSNs and processing claims.
- Potential for Errors: Errors in SSN verification could lead to eligible families being denied benefits.
- Complexity: Adds complexity to the tax filing process, potentially requiring additional assistance for some taxpayers.
- Negative Impact on Children: Denying the child tax credit based on parental SSN status could negatively impact children in need.
Most Disadvantaged Areas:
Constitutional Alignment
The bill's constitutionality is complex. Congress has the power to tax and spend for the general welfare (Article I, Section 8). However, the bill's potential impact on certain groups raises questions about equal protection under the law.
The Fifth Amendment ensures due process, and the bill's implementation must ensure fair procedures for verifying SSNs and appealing denials of benefits. The bill does not appear to infringe on any explicit constitutional rights, such as freedom of speech or religion.
However, its impact on vulnerable populations warrants careful consideration to ensure it aligns with constitutional principles of fairness and equal protection.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).