Court allows IRS to share tax info for deportation efforts

On Monday, a federal judge declined to halt the exchange of tax information between the Internal Revenue Service (IRS) and Immigration and Customs Enforcement (ICE), a move aimed at tracking and deporting undocumented immigrants in the United States.
The ruling marks a victory for the Trump administration, as U.S. District Judge Dabney Friedrich turned down a request for a preliminary injunction in a lawsuit brought by nonprofit organizations. These groups argued that undocumented immigrants who contribute taxes deserve the same privacy safeguards as U.S. citizens and immigrants residing legally.
Judge Friedrich, nominated by President Donald Trump, had previously rejected a temporary order in this suit.
This decision follows closely on the heels of former acting IRS commissioner Melanie Krause’s resignation, a response to the accord enabling ICE to cross-reference names and addresses of undocumented immigrants with IRS tax records.
Alan Butler Morrison, attorney for the nonprofits, expressed disappointment at the court’s rejection of the injunction but emphasized that the lawsuit is far from resolved. “We are evaluating our next steps,” Morrison stated in an email. He also pointed out that the judge’s ruling specifies that both the Department of Homeland Security (DHS) and the IRS must adhere strictly to the limitations outlined in this case.
“To date, DHS has not formally requested taxpayer data, and plaintiffs will vigilantly monitor to ensure compliance with legal requirements and prevent misuse of exceptions,” Morrison added.
The IRS has faced turmoil due to the Trump administration’s decisions on sharing taxpayer information. A previous acting commissioner opted for retirement amid controversy over Elon Musk’s Department of Government Efficiency obtaining IRS data access.
The Treasury Department contends that the arrangement with ICE supports President Trump’s efforts to enhance U.S. border security and his wider immigration crackdown efforts, which have led to increased deportations, workplace raids, and implementations of outdated laws to deport Venezuelan migrants.
According to the acting ICE director, collaboration with Treasury and other departments is reserved “strictly for significant criminal cases.”
However, advocates argue that the information-sharing agreement between IRS and DHS infringes on privacy rights and erodes everyone’s privacy.
Judge Friedrich concluded in her ruling that the agreement does not infringe the Internal Revenue Code, as it doesn’t alter IRS handling of taxpayer data. The Trump administration is rather utilizing pre-existing “statutorily authorized tools” for aiding criminal investigations, she penned.
As per federal law, IRS can release limited taxpayer information if it assists criminal enforcement actions and if the seeking agency meets several criteria, the judge noted.
Nevertheless, this does not imply unrestricted access to IRS-held data.
The requesting agency must first possess the individual’s name and address, then provide this to the IRS along with applicable time spans, the legal basis for releasing said information, and relevance for investigation.
“Essentially, the IRS may disclose data it acquires independently (such as through audits), but not what is exclusively obtained from taxpayer filings,” Friedrich elaborated. She highlighted a crucial exemption — a taxpayer’s identity, including name, address or tax ID number, is not inclusive within protected tax return data.