Is it just that undocumented workers pay Social Security taxes but will never receive benefits?
That’s a large part of the issue. My wife is a social worker, and I’ve worked as a controller for several small businesses in South Texas over the last 20 years. What we’ve both seen is that many undocumented workers used fake or forged social security documents with either made up SSN’s or someone else’s’ SSN. The companies they work for then pay the Employer’s portion of the tax, and withhold the Employee’s portion from their paycheck, and send it in to the government, but of course, the undocumented worker won’t be able to collect on those earnings. For those who use someone else’s SSN in some cases, the real owner of the SSN will get those wages credited to his or her social security account, increasing the benefits that person would be eligible for when they retire. In most cases however, Social Security catches the mistake when the W-2 is submitted, and then doesn’t credit the monies to any specific account for benefit determination. So in that isolated context, having the undocu