IRS Nearing Controversial Deal to Share Undocumented Taxpayer Data with ICE

The proposed agreement, still under negotiation, has drawn criticism over privacy concerns, economic risks, and potential erosion of trust in the tax system.

The IRS is reportedly close to finalizing an agreement with ICE to share taxpayer data of undocumented immigrants who file taxes using ITINs.
The deal would allow ICE to cross-reference IRS data to verify the names and addresses of individuals suspected of being in the U.S. illegally.
Critics, including Democratic lawmakers and privacy advocates, warn the agreement could deter undocumented immigrants from filing taxes, reducing federal revenue and violating privacy laws.
Undocumented immigrants contributed approximately $60 billion in federal taxes in 2022, and experts fear the agreement could push many into informal, cash-based economies.
The Trump administration has prioritized deportations as part of its broader immigration agenda, with this proposed data-sharing deal representing a significant shift in federal agency collaboration.