Treasury Secretary Scott Bessent announced Friday that his department is moving to cut off federal tax benefits for undocumented immigrants, following President Donald Trump's directive to reserve these programs for U.S. citizens.
Tax Benefits Getting the Axe
In a post on X, Bessent laid out the plan: Treasury will issue proposed regulations clarifying that several major individual income tax benefits are off-limits to undocumented and other non-qualified immigrants. The list includes the Earned Income Tax Credit, the Additional Child Tax Credit, the American Opportunity Tax Credit, and the Saver's Match Credit.
Bessent framed the move as both a matter of law enforcement and national security. The Treasury Department, he said, would strictly enforce U.S. laws governing who can access these benefits. But he didn't stop there.
The Treasury Secretary also took aim at what he characterized as exploitation of the U.S. financial system, claiming that undocumented immigrants have used American financial institutions to move funds obtained illegally. He directed the Financial Crimes Enforcement Network (FinCEN) to ramp up efforts to detect, identify, and report suspicious cross-border money transfers involving undocumented individuals.
"Illegal aliens that use our financial institutions to move their illicitly obtained funds is exploitation, and it will end," Bessent wrote.
Benefits Restrictions Spread Across Government
The Treasury's announcement fits into the Trump administration's wider immigration enforcement strategy. Trump himself outlined key elements of this approach in a Thanksgiving message on X, where he discussed what he called the "refugee burden" on the United States, attributing it to "social dysfunction…something that did not exist after World War II."
Back in July, HHS Secretary Robert F. Kennedy Jr. announced that undocumented immigrants would be excluded from the Head Start program and various other federal benefits. That includes homelessness assistance, Title X family planning services, substance abuse treatment, and mental health services—programs that had traditionally used income-based eligibility criteria rather than immigration status checks.
The Department of Education joined in as well, declaring that undocumented immigrants would no longer qualify for taxpayer-funded postsecondary education benefits. These policy shifts followed the repeal of Clinton-era guidance that had previously allowed some undocumented individuals to access certain federal public benefits.
Immigration Policy Takes Harder Turn
Just days before Bessent's announcement, Trump declared a permanent halt to migration from Third World Countries and signaled plans to tighten immigration rules further.
The timing wasn't coincidental. These policies emerged in response to a street attack near the White House where an Afghan national opened fire on two West Virginia National Guard members. Following that incident, the administration also ordered a comprehensive review of green cards issued to individuals from 19 "countries of concern."