IRS on the Verge of Sharing Taxpayer Data with ICE, Threatening Undocumented Workers
For years, the Internal Revenue Service (IRS) has maintained a crucial assurance to undocumented workers in the United States: they could file their taxes honestly without fear of their personal information being used against them for deportation purposes. This promise, designed to encourage tax compliance, appears to be on the precipice of crumbling. A significant shift in policy is looming, raising serious concerns about the privacy and safety of millions of undocumented immigrants who contribute substantially to the US economy.
According to reporting by the Washington Post, the IRS is nearing completion of an agreement with Immigration and Customs Enforcement (ICE) that would dramatically alter the landscape of taxpayer privacy. This deal would effectively grant ICE access to previously confidential personal information held within the IRS’s vast databases, potentially undermining the agency’s long-standing commitment to safeguarding taxpayer data.
Under the proposed agreement, ICE would be authorized to submit requests to the IRS for the names and addresses of individuals suspected of being undocumented. The IRS would then cross-reference these names against its confidential taxpayer records to verify the information. While the agreement is reportedly intended to be narrower in scope than previous requests from the Trump administration, specifically focusing on immigrants already subject to deportation orders, it nonetheless represents an unprecedented expansion of data sharing between the two agencies.
The implications of this agreement are profound and potentially devastating. The information gleaned from the IRS databases would likely be used by ICE to locate and detain individuals for deportation, effectively weaponizing the tax system against a vulnerable population. This move signals a significant departure from the IRS’s traditional role as a neutral tax collection agency and raises fundamental questions about the relationship between taxation, privacy, and immigration enforcement.
The potential for abuse and misuse of this data is considerable. While the agreement may initially focus on individuals with existing deportation orders, there is a risk that the scope could be expanded in the future, potentially targeting a broader range of undocumented immigrants. The chilling effect of such a policy could also deter undocumented workers from filing taxes, leading to a decrease in government revenue and a further marginalization of this community.
It might seem surprising that the IRS hasn’t already been sharing this type of information with ICE, but there are compelling reasons why such data sharing has been historically prohibited. The first and most significant reason is the stringent legal framework protecting taxpayer privacy. US law generally prohibits the IRS from disclosing any taxpayer information, including basic details like names and addresses, without a court order or other specific legal authorization. This protection is crucial for maintaining public trust in the tax system and ensuring that individuals feel comfortable providing accurate and complete information to the IRS.
The second reason is economic. The IRS has long recognized that encouraging tax compliance among undocumented workers is in the best interest of the government and the economy. By assuring undocumented workers that their information would be kept confidential, the IRS has incentivized them to pay taxes, contributing billions of dollars in revenue each year.
In 2022 alone, undocumented workers paid an estimated $100 billion in taxes. Moreover, many of these workers file their taxes using an Individual Taxpayer Identification Number (ITIN) rather than a Social Security number, which means they are ineligible for certain benefits like the Earned Income Tax Credit. They also do not qualify for Social Security retirement benefits or Medicare, despite contributing to these programs through their taxes.
According to the Tax Policy Center, an immigrant who arrives in the United States at age 25 will, on average, pay $200,000 more in taxes than they receive in government benefits over their lifetime. This highlights the significant economic contribution of undocumented workers and the potential financial consequences of deterring them from paying taxes.
The Trump administration consistently pressured the IRS to share data on undocumented workers as part of its broader agenda to increase deportations. Last month, the Department of Homeland Security (DHS) requested the addresses of 700,000 suspected undocumented immigrants, a request that the IRS initially rejected. However, this sweeping request reportedly led to negotiations for a narrower data-sharing agreement that the IRS considered less likely to violate tax privacy laws. This agreement now appears to be on the verge of being finalized.
Legal challenges have already been filed in an attempt to block the IRS from sharing information for immigration enforcement purposes. However, a federal judge, appointed by Trump during his first term, recently rejected a motion to prevent such an agreement. This decision has emboldened proponents of the data sharing initiative and has raised concerns about the impartiality of the judiciary in immigration matters.
Several Democratic Senators have voiced their opposition to the proposed agreement, raising concerns about the privacy rights of undocumented workers and the potential for abuse. However, these efforts have thus far failed to generate significant resistance. Meanwhile, DHS has recently shut down its internal watchdog agencies that advocated for immigrant rights, further silencing dissenting voices within the government.
The impending agreement between the IRS and ICE represents a dangerous erosion of taxpayer privacy and a betrayal of the government’s commitment to fair and equitable treatment of all individuals, regardless of their immigration status. It threatens to undermine the tax system, deter compliance, and ultimately harm the economy. The consequences of this policy shift could be far-reaching and devastating, not only for undocumented workers but for the broader principles of justice and fairness that underpin American society. The fight to protect taxpayer privacy and ensure the humane treatment of undocumented immigrants is far from over, and requires sustained vigilance and resistance from all those who believe in a just and equitable society.
