Tax agency admits improper data sharing with immigration authorities

The nation’s tax collection agency has reportedly disclosed confidential taxpayer information belonging to thousands of individuals to immigration enforcement authorities, according to a recent court filing that highlights ongoing tensions over the government’s approach to undocumented residents.

The Treasury Department, the Internal Revenue Service, and the Department of Homeland Security finalized an agreement last spring that observers say represents a significant departure from longstanding policy. The arrangement allows taxpayer data to be shared with immigration authorities to assist in identifying individuals residing in the country without legal authorization.

The data-sharing agreement, which allegedly led to the resignations of senior tax agency officials, authorized Immigration and Customs Enforcement to submit names and addresses of undocumented individuals to the revenue service for cross-verification against tax records.

In a declaration filed this week, the tax agency’s Chief Risk and Control Officer reportedly stated that the service was able to verify approximately 47,000 of the 1.28 million names requested by immigration enforcement, which were subsequently disclosed to the enforcement agency.

According to the filing, the tax collection service provided immigration authorities with additional address information for under 5% of those names, potentially violating privacy regulations designed to protect taxpayer data.

The revenue agency acknowledged it recently discovered what officials characterized as a mistake and indicated it is working with other federal departments to resolve the matter, according to sources familiar with the situation.

Treasury officials reportedly notified the homeland security department last month of the error and requested assistance in “promptly taking steps to remediate the matter consistent with federal law,” which includes “appropriate disposal of any data provided to immigration enforcement based on incomplete or insufficient address information.”

The controversial agreement between the tax and homeland security agencies has sparked litigation against the current administration and broke what observers describe as a longstanding policy that encouraged immigrants to pay taxes even without legal status by assuring them their data remained protected.

A lawsuit was filed against the Treasury Secretary and Homeland Security Secretary on behalf of several immigrant rights organizations shortly after the agreement was signed, according to court records.

Last week, a federal judge reportedly ordered the tax agency to cease disclosing residential addresses to immigration enforcement, marking the second judicial ruling blocking the revenue-homeland security arrangement.

In November, a different federal judge had blocked the tax service from sharing information with homeland security authorities, ruling that the agency illegally disseminated tax data of some migrants over the summer, allegedly violating taxpayer confidentiality laws.

Advocacy groups have expressed concern that the potential unlawful release of taxpayer records could be used to target citizens and violate their privacy rights.

“Once taxpayer data is opened to immigration enforcement, mistakes are inevitable and the consequences fall on innocent people,” a policy counsel for the Center for Democracy & Technology told news agencies. “The disclosure of thousands of confidential records unfortunately shows precisely why strict legal firewalls exist and have — until now — been treated as an important guardrail.”

The controversy reflects broader tensions within the country over immigration policy and the balance between enforcement priorities and privacy protections, issues that have long divided the nation’s political establishment.