IRS and DHS have formalized an unprecedented data-sharing agreement enabling ICE to access taxpayer information for locating illegal immigrants subject to deportation, while the acting IRS commissioner resigns in apparent protest.
Quick Takes
- A new Memorandum of Understanding allows ICE to verify addresses of illegal immigrants with final deportation orders by cross-referencing IRS tax records.
- The agreement specifically targets individuals who have overstayed 90 days after a judge’s final removal order.
- Acting IRS Commissioner Melanie Krause has resigned following the deal, reportedly in protest.
- The agreement was signed by Treasury Secretary Scott Bessent and DHS Secretary Kristi Noem, bypassing Krause.
- A federal judge has rejected immigrant advocacy groups’ request for an emergency injunction to block the information sharing.
Historic Agreement Between Tax and Immigration Authorities
The Department of Homeland Security and the Internal Revenue Service have established a formal data-sharing arrangement that allows ICE to request taxpayer information when investigating illegal immigrants subject to deportation. The memorandum of understanding (MOU) filed by the Trump administration creates a secure process for immigration officials to confirm the addresses of individuals who have overstayed their deportation orders by cross-checking IRS tax records. The agreement specifically targets illegal immigrants who have remained in the country more than 90 days after receiving a judge’s final removal order.
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Privacy Protections and Legal Framework
The agreement operates under longstanding authorities granted by Congress that allow for specific exceptions to taxpayer privacy protections. Treasury officials emphasized that the MOU aims to protect the privacy of law-abiding Americans while enabling law enforcement to pursue individuals with existing deportation orders. The data sharing occurs under a criminal exception to standard privacy protections, though some IRS officials have expressed concern that this exception was intended for criminal investigations rather than immigration enforcement.
Department of Justice lawyers have assured that “DHS and ICE must safeguard any return information disclosed by the IRS” in compliance with federal law. As of the filing, the IRS reportedly had not received any actual requests for taxpayer information from DHS or ICE under the new agreement. Immigration advocacy groups and Public Citizen filed a lawsuit seeking to block the information sharing, but US District Court Judge Dabney L. Friedrich declined to issue an emergency injunction, stating the plaintiffs had not established a likelihood of success on the merits.
Leadership Upheaval at the IRS
The controversial agreement has already triggered significant changes at the IRS. Acting Commissioner Melanie Krause has announced her resignation, reportedly in protest of the Trump administration’s actions regarding the data-sharing arrangement. According to reports, the MOU was signed by Treasury Secretary Scott Bessent and Homeland Security Secretary Kristi Noem directly, bypassing Krause. Some IRS attorneys have expressed concerns that the data-sharing agreement may violate existing privacy laws.
The IRS has historically allowed illegal immigrants to file tax returns using Individual Taxpayer Identification Numbers (ITINs), resulting in significant contributions to Social Security taxes. Some officials worry the new policy could hinder tax collection from undocumented immigrants who may now fear filing returns. Simultaneously, the IRS has begun implementing significant job cuts, aiming to reduce its workforce by approximately 25% as part of broader restructuring efforts under the new administration.
Congressional Oversight and Political Reactions
The data-sharing agreement has predictably divided lawmakers along partisan lines. Democratic senators have requested additional information about DHS activities involving IRS systems, expressing concerns over potential misuse of the tax system against undocumented immigrants. Many Republicans have applauded the move as a necessary enforcement tool to address illegal immigration. The agreement represents a significant policy shift that leverages existing government data systems for immigration enforcement purposes.
Sources:
- IRS and DHS reach historic deal to aid in pursuit of illegal immigrants subject to deportation
- Head of IRS to resign in protest as agency inks deal to share tax data on illegal immigrants with DHS
- IRS Agrees to Share Data With Homeland Security on Illegal Immigrants
