Undocumented immigrants pay billions into Social Security and Medicare every year, even though most cannot draw benefits from either program

Undocumented workers contribute to Social Security and Medicare through payroll taxes — the same deductions that come out of any worker's paycheck. When an employer withholds these taxes, the money goes into the same federal trust funds that pay benefits to citizens and legal residents. The Internal Revenue Service does not distinguish between documented and undocumented workers when collecting these taxes. A worker with a false or borrowed Social Security number, or one issued under a temporary visa that has expired, still has taxes withheld at the standard rate: 6.2 percent for Social Security and 1.45 percent for Medicare.

The total contribution is substantial. Research estimates that undocumented immigrants contribute between $11 billion and $13 billion annually to Social Security alone, and roughly $2 billion to $3 billion to Medicare, though these figures vary depending on the size of the undocumented workforce in any given year. These contributions accumulate in the trust funds but are rarely claimed, because undocumented immigrants are ineligible for Social Security retirement benefits, Medicare coverage, or Supplemental Security Income (SSI) — with very narrow exceptions.

Key Takeaways

  • Undocumented workers have payroll taxes withheld for Social Security and Medicare at the same rate as all other workers, whether they use a valid number or not.
  • Most undocumented immigrants cannot draw Social Security retirement benefits, Medicare, or SSI, even after paying into these programs for decades.
  • The money paid in by undocumented workers stays in the Social Security and Medicare trust funds and helps sustain benefits for current retirees and beneficiaries.
  • A small number of undocumented immigrants may become may be able to access for benefits if they later obtain legal status, but may be able to access depends on work history and the type of status granted.

How payroll taxes are collected from undocumented workers

Employers are required by law to withhold Social Security and Medicare taxes from every employee's paycheck, regardless of immigration status. The employer also contributes a matching amount. The withholding happens automatically when a worker provides a Social Security number — whether that number is valid, belongs to someone else, or was issued under a visa that has since expired.

Many undocumented immigrants work under false or borrowed numbers. When taxes are withheld under a number that does not match the worker's identity, the IRS records the payment but flags it as "no-match" earnings. The money still goes into the Social Security and Medicare trust funds. The IRS does not report these discrepancies to immigration authorities, and workers are not penalized for the mismatch.

Some undocumented immigrants work in cash-only jobs where no taxes are withheld at all. Others are self-employed and do not file tax returns. These workers contribute nothing to Social Security or Medicare. But the majority of undocumented workers — estimates range from 50 to 75 percent — do have payroll taxes withheld.

Why undocumented immigrants cannot claim Social Security or Medicare benefits

Federal law restricts Social Security and Medicare to U.S. citizens and certain categories of legal immigrants. Undocumented immigrants do not fall into any of these categories. Even if an undocumented worker has paid into Social Security for 40 quarters (the standard requirement for retirement benefits), they cannot claim those benefits unless they first obtain legal status.

The same rule applies to Medicare. An undocumented immigrant cannot enroll in Medicare Part A or Part B, even at age 65, unless they are a U.S. citizen or a may have access to immigrant. There is no exception for workers who have contributed for many years. Supplemental Security Income (SSI) — the needs-based program for elderly, blind, or disabled people with low income — is also closed to undocumented immigrants.

The only narrow exception involves Temporary Protected Status (TPS) holders and certain refugees. A person with TPS may be able to claim Social Security retirement benefits if they have enough work credits and meet other requirements, though TPS itself does not automatically confer this right. Refugees and asylees who have been granted status can claim benefits like any other legal resident.

What happens to the money undocumented immigrants pay in

The payroll taxes withheld from undocumented workers' paychecks go directly into the Social Security Trust Fund and the Medicare Hospital Insurance Trust Fund, the same accounts that pay current retirees and beneficiaries. Because most undocumented workers never claim benefits, the money they contribute effectively subsidizes the system for others.

The Social Security Administration does not set aside or earmark contributions by immigration status. All payroll taxes flow into one pool. When a retiree receives a Social Security check, it is paid from this combined pool — which includes contributions from undocumented workers who will never draw from it.

Economists have studied whether this arrangement strengthens or weakens Social Security's long-term finances. The consensus is that undocumented workers' contributions provide a modest boost to the trust funds in the short term, because the contributions are collected but the benefits are not paid out. However, this effect is small relative to the overall challenges facing Social Security's solvency.

What changes if an undocumented immigrant later obtains legal status

If an undocumented worker later becomes a lawful permanent resident (green card holder) or U.S. citizen, they may become may be able to access to claim Social Security retirement benefits — but only if they have accumulated enough work credits. The Social Security Administration will count work quarters earned before legal status was obtained, even if those quarters were earned under a false or mismatched number.

The process of claiming benefits after obtaining status can be complicated. The worker must provide documentation of their work history, which may require explaining how they worked under a number that did not match their identity. The Social Security Administration has procedures for this situation, but the outcome depends on the specific facts and the type of legal status granted.

A person granted asylum or refugee status can claim benefits more straightforwardly, because these statuses are recognized as legal from the moment they are granted. A person who obtains a green card through family sponsorship or employment may also claim benefits, provided they meet the work-credit requirement.

The role of Individual Taxpayer Identification Numbers (ITINs)

Some undocumented immigrants file tax returns using an Individual Taxpayer Identification Number (ITIN) instead of a Social Security number. An ITIN is issued by the IRS to people who need to file taxes but do not have a Social Security number. Undocumented immigrants can obtain an ITIN and use it to file federal income tax returns.

However, an ITIN does not allow a person to pay into Social Security or Medicare. If an undocumented worker files taxes using an ITIN, they do not have payroll taxes withheld for Social Security or Medicare. They may owe self-employment tax if they are self-employed, but this does not create Social Security or Medicare credits. An ITIN is strictly for tax filing purposes.

Some undocumented immigrants use both an ITIN (for tax filing) and a Social Security number (for employment). In these cases, payroll taxes are withheld under the Social Security number, and the worker files taxes using the ITIN. This arrangement is common but creates a mismatch in IRS records.

How this affects the broader Social Security and Medicare picture

The contribution of undocumented immigrants to Social Security and Medicare is real but often overlooked in policy discussions. The funds they pay in help sustain current benefits for retirees and disabled workers. At the same time, because they do not claim benefits, they do not draw down the trust funds in proportion to what they contribute.

The size of the undocumented workforce fluctuates year to year, so the total contribution varies. During years when immigration enforcement is stricter or the economy is weaker, fewer undocumented workers are employed and contributions decline. During years of stronger economic growth and higher undocumented employment, contributions rise.

Some policymakers have proposed allowing undocumented immigrants to claim Social Security benefits if they obtain legal status, or even creating a separate benefit track for undocumented workers. Others argue that current law should remain unchanged. These are policy questions, not questions about how the current system works — but they reflect the fact that undocumented workers' contributions to Social Security and Medicare are substantial and measurable.

Frequently Asked Questions

Can an undocumented immigrant get a Social Security number to work legally?

No. Social Security numbers are issued only to U.S. citizens and certain categories of legal immigrants. An undocumented immigrant cannot obtain a valid Social Security number. Many undocumented workers use false or borrowed numbers, or numbers issued under expired visas. The IRS does not report these mismatches to immigration authorities.

If an undocumented immigrant worked for 40 years and paid into Social Security, can they claim benefits later?

Not unless they first obtain legal status. Federal law bars undocumented immigrants from claiming Social Security retirement benefits, regardless of how long they worked or how much they paid in. If they later become a lawful permanent resident or citizen, they may become may be able to access, and the Social Security Administration will count work quarters earned before legal status was obtained.

Does the money undocumented immigrants pay into Social Security get refunded if they never claim benefits?

No. Payroll taxes are not refundable. The money stays in the Social Security Trust Fund and is used to pay current beneficiaries. If an undocumented worker never claims benefits, their contributions effectively subsidize the system for others.

Can an undocumented immigrant use an ITIN to pay into Social Security?

No. An ITIN is for tax filing only and does not create Social Security or Medicare credits. Payroll taxes are withheld only when a worker uses a Social Security number. An undocumented immigrant can file taxes with an ITIN but cannot build Social Security credits that way.

What happens to the "no-match" earnings reported by undocumented workers?

The money goes into the Social Security and Medicare trust funds like any other payroll tax. The IRS flags the earnings as "no-match" but does not investigate or penalize the worker. The funds are used to pay current beneficiaries. If the worker later obtains legal status and can prove their work history, the Social Security Administration may count those quarters toward their benefit may be able to access.