Irs Agrees To Share Tax Data With Immigration Authorities

The IRS has agreed to share confidential taxpayer data to help the Trump administration's crackdown on undocumented immigration, according to a new court filing.

IRS and Department of Homeland Security officials have been working for weeks to hammer out an arrangement under which immigration authorities could ask the tax agency for information on undocumented immigrants, such as their home addresses.

Taxpayer information is among the most closely guarded data in the federal government, and the negotiations sent off alarm bells in the IRS when they were disclosed.

The Treasury Department, which includes the IRS, revealed that it had signed the agreement on Monday, in a filing asking a federal court to toss out a lawsuit from immigrant rights groups seeking to stop the sharing of tax data.

Federal law strictly guards confidential taxpayer data, though there are exceptions. The IRS is willing to share information with DHS and Immigration and Customs Enforcement under an exception allowing the tax agency to assist in criminal investigations, according to the court filing.

“The Memorandum of Understanding ('MOU') signed by the Department of the Treasury and DHS reiterates the agencies’ commitment to sharing information only in the way that" tax law “permits and includes clear guardrails to ensure compliance…," a Justice Department attorney said in the filing.

DHS has yet to ask the IRS for any confidential information under the agreement, nor has the tax collector shared anything yet.

Still, the arrangement marks a major shift for the IRS, which for years has urged undocumented workers to file their taxes — and promised to protect their confidential information.

Taxpayer advocates and former IRS officials have said that the widespread sharing of confidential information, as envisioned in this new agreement, would mark an abrupt change in how the agency has used the criminal investigation exception.

DHS’ request for help also has caused major upheaval at the tax agency, as has the work of Elon Musk’s Department of Government Efficiency, which has also sought access to sensitive databases and driven the dismissal of thousands of employees.

An acting commissioner, Doug O’Donnell, quickly retired late in February amid the discussions over data sharing, while the Trump administration demoted the acting chief counsel, William Paul, in mid-March.

The current acting commissioner, Melanie Krause, has been far more open to striking agreements with DOGE and immigration authorities, according to former government officials.