A quiet negotiation between two major federal agencies may soon have wide-reaching consequences. According to Fox News, the Internal Revenue Service (IRS) and U.S. Immigration and Customs Enforcement (ICE) are nearing an agreement that could alter how personal data is handled across departments.
While the specifics remain under review, early expert reactions suggest the implications could be substantial—particularly for undocumented immigrants navigating both the tax system and immigration enforcement.
The potential shift has sparked debate within government circles and raised new questions about the balance between law enforcement and institutional trust.
What the Deal Entails
The proposed agreement would allow ICE to provide the IRS with information about illegal immigrants, such as their names and addresses.
The IRS could then cross-check these records with its existing tax files, potentially providing ICE with accurate and up-to-date address information.
This move comes as part of the ongoing efforts by the Trump administration to expedite deportations and enforce stricter immigration policies.
The deal has drawn criticism from several longtime IRS employees, who argue that it undermines the trust the agency has built by safeguarding taxpayer privacy.
For many years, illegal immigrants have been able to file taxes and fulfill their legal obligations without the fear of their information being shared with immigration authorities. As Adam Brewer, a federal tax expert at AB Tax Law, explained,
“It is going to discourage those taxpayers from even filing, so it really does put them between a rock and a hard place.”
The potential breach of this privacy agreement is seen as a deviation from the established norm.
Implications for Tax Compliance
Brewer highlighted that this information-sharing arrangement could discourage illegal immigrants from filing taxes in the future. Many undocumented individuals file taxes as part of their effort to eventually gain legal status. Brewer added:
“The IRS knows and ICE knows that these tax returns are required, and now they’ve really put a big disincentive in front of taxpayers from filing.”
The fear of deportation due to their tax records being shared with ICE could deter them from fulfilling their tax obligations. This, in turn, could negatively impact the IRS’s ability to collect revenue.
“This feels like a deviation from what we’ve known for years … that if you share information with the IRS, it stops there,” Brewer said.
The Role of the IRS in Criminal Investigations
Historically, the IRS has been involved in criminal investigations, often working with agencies such as the Drug Enforcement Administration (DEA) to track illegal activities like drug trafficking.
However, this new partnership with ICE would expand the scope of the IRS’s involvement in immigration law enforcement. Brewer pointed out:
“For the IRS to get involved in criminal investigations, that’s not uncommon. They have done a lot of information sharing, historically, with DEA to crack down on drug proceeds, those types of things. I guess the way I’m looking at it is, if illegal immigration itself is the crime, if you look at it through that scope, then yes, it’s pretty unprecedented.”
Experts have described this step as significant, as the IRS has traditionally focused on financial crimes rather than immigration violations.
Brewer also expressed concerns that the IRS’s involvement in tracking immigration violations could erode the agency’s credibility, which has been built on a long-standing commitment to protecting taxpayer privacy.
“That would be true of any government agency if they had said, ‘Hey, the DMV is going to start turning over your address to ICE.’ You’re going to get less people who register their vehicles or who renew their driver’s license. That’s just the reality,” he said.
Potential Benefits for ICE’s Operations
On the other hand, the sharing of address information could be beneficial for ICE, allowing the agency to quickly locate individuals in violation of immigration law.
The IRS’s records, especially recent tax filings, would likely contain more accurate and recent address data than older immigration documents, which may be outdated. Brewer noted:
“If someone just filed a tax return last month for 2024, that address information would be more recent or more likely to be accurate than some immigration document they filed last year.”
This efficiency could streamline ICE’s efforts to enforce immigration laws and prioritize resources.
