A government-issued tax processing number is opening the door for a new trend in Bowling Green and other areas - allowing those without Social Security numbers to have access to home loans, life insurance and other financial products.

The growing trend highlights the continuing debate regarding the economic impact of immigrants.

Called an Individual Tax Identification Number, or ITIN, the number is issued by the Internal Revenue Service for certain resident and non-resident immigrants, their spouses and their dependents who are not eligible to obtain a Social Security card, according to IRS media relations specialist Jodie Reynolds.

“Only individuals who have a valid filing requirement or are filing a tax return to claim a refund ... are eligible to receive an ITIN,” Reynolds said in an e-mail. “The Internal Revenue Service issues ITINs to help individuals comply with the U.S. tax laws, and to provide a means to efficiently process and account for tax returns and payments for those not eligible for Social Security numbers.”

In 1996, the U.S. Department of the Treasury required foreign people to use an ITIN as their unique identification number on W-7 federal tax returns.

Since 1996, more than 12.4 million ITINs have been issued, Reynolds said. The number continues to grow, with about 1.7 million ITINs issued in the U.S. last year, up from the 1.5 million issued in 2006 and the 1.1 million issued in 2005, according to the IRS.

For those who have ITINs, getting into a house is no walk in the park, even though the trend has taken off in the last couple of years in larger metropolitan areas, according to Elizabeth Turner, owner of First Choice Funding in Bowling Green.

In her office, she distinguishes among the various classifications of immigrants as those who “have papers” from those who “have no papers.” There are those who are in the country illegally with no documentation, those with work permit visas, as well as those who are in the country on a temporary protected status.

Turner, who also processes Federal Housing Administration and Veterans Administration loans, works with a list of 50 or so banks and private investors who fund loans with ITINs.

“Even if they are illegal and they can’t get some type of work permit, they are still working,” Turner said. “They can file taxes on the money that they’ve earned even being illegal.”

According to the Pew Hispanic Center, recent estimates using U.S. Census Bureau data show about 11 million illegal immigrants in March 2005, with about 7 million undocumented workers - five percent of the country’s work force, according to the center’s report.

Turner said that lenders require ITIN holders to put a certain amount money down for a house and meet a long list of criteria, including two years of work history, that they have lived in the United States for two years and can show proof of two years of tax returns.

ITIN holders also should show two years of rental history and are subject to several background checks from a lender to check for criminal violations.

“They’ll make sure they’re good, sound people,” Turner said.

With a solid financial history, lenders will give them credit, Turner said.

The loans are governed and audited by the U.S. Department of Housing and Urban Development and the Office of Financial Institutions, Turner said, which restricts how much money lenders can make off such loans.

The ITIN is also opening doors for people to gain interest-bearing bank accounts through the Bank of America, as well as obtain life insurance, something Turner sees as the private sector cashing in on a growing population within the U.S.

“Everybody’s doing it,” she said.

The Federal Deposit Insurance Corporation doesn’t keep track of who is opening bank accounts using ITINs and who doesn’t, according to FDIC spokesman David Barr.

“The FDIC does not track that data. Banks do not need our approval in order to make such loans, nor do we have a program that promotes the use of ITIN mortgages,” Barr said.

Turner said illegal immigrants are a growing part of the economy - paying rent and utilities, using cell phones, buying cars, meals, clothes and haircuts, sending mail and money transfers, paying local attorneys for immigration work and divorces, and eating at local restaurants - all of which add to the goods and services consumed.

“Our government profits off of illegal immigrants already,” she added, pointing to those who pump money into Social Security who never withdraw.

The Social Security Administration said in its latest actuarial report that “the unfunded liabilities of Social Security decrease with increasing rates of net immigration ... Each 100,000 net immigrants increase the long-range actuarial balance by about .07 percent of taxable payroll.”

America’s immigration problem has many different dimensions as a very complex issue that is conflicting the thoughts of economists, politicians and the public, according to economist Bill Davis, chair of the Western Kentucky University Department of Economics.

Davis said whether illegal immigrants are a short-term benefit to the U.S. economy is still in dispute among leading economists like Thomas Sowell, Robert Rector and others.

A study by Rector found that households headed by low-skilled immigrants use $89 billion more in government services then they pay in taxes. In contrast, a 1997 study by the National Academy of Sciences concluded that over their lifetimes, immigrants and their children pay an estimated $80,000 more in taxes to all levels of government then they receive in benefits.

A 2006 National Bureau of Economic Research study noted that “immigrants stimulate investment, have skills sets and educational levels that complement those of natives, and do not compete for the same jobs as most natives.”

Davis said while there is conflicting research on both sides, he recognizes the controversial issue of illegal immigration brings feelings of divisiveness in America - ironically and historically a place of immigrants from its very inception.

“It is beginning to tear at the fabric of our society,” Davis said. “I sort of side with those who want a break, who want to slow things down and get a handle on the problem and gather more evidence on the economic impacts. It’s still in dispute if net benefits are positive or negative in the short-run. In the long run, it’s a little more clear.”

With assimilation, gaining more skills and attaining more education, Davis suspects the current wave of immigrants will be no different from previous ones that have “melted in” to the pot of American diversity.

— For more information on ITINS, go to www.irs.gov/indi viduals/article/0,,id=96287,00.html.