IRS Erroneously Shares Taxpayer Data with DHS

The Internal Revenue Service (IRS) erroneously shared the taxpayer information of thousands of individuals with the Department of Homeland Security (DHS). This disclosure, revealed in a recent court filing, occurred as part of an agreement between the agencies to share information on immigrants to identify and deport individuals illegally present in the U.S.

Details of the Data Sharing

Last April, Treasury Secretary Scott Bessent and Homeland Security Secretary Kristi Noem signed an agreement allowing U.S. Immigration and Customs Enforcement (ICE) to submit names and addresses of immigrants to the IRS for cross-verification against tax records. According to a declaration filed by IRS Chief Risk and Control Officer Dottie Romo, the IRS verified approximately 47,000 of the 1.28 million names ICE requested.

For less than 5% of these individuals, the IRS provided ICE with additional address information. Romo stated that this action potentially violated privacy rules designed to protect taxpayer data. The Treasury Department notified DHS of the error in January and requested assistance in remediating the matter, including the appropriate disposal of data provided to ICE based on incomplete or insufficient address information.

For less than 5% of the individuals whose names were submitted, the IRS provided ICE with additional address information, an action which "potentially violated privacy rules designed to protect taxpayer data."

Legal Challenges and Court Orders

This IRS-DHS agreement initiated litigation from advocacy groups last year. Public Citizen filed a lawsuit against the Treasury and Homeland Security departments on behalf of several immigrant rights organizations.

A Massachusetts federal court has since ordered the IRS to stop sharing residential addresses with ICE. Additionally, a federal court blocked the IRS from sharing information with DHS last November, citing the illegal dissemination of tax data belonging to some migrants the previous summer.

Advocacy Group Concerns

Advocates have expressed concerns that the potential unlawful release of taxpayer records could be used to target individuals, violate their privacy, and lead to other adverse outcomes. Lisa Gilbert, co-president of Public Citizen, stated that this data breach was a factor in their lawsuit, asserting that sharing private taxpayer data can create chaos and endanger lives if federal agents use it to track individuals.

Tom Bowman, policy counsel for the Center for Democracy & Technology, remarked that "the improper sharing of taxpayer data is unsafe, unlawful, and subject to serious criminal penalties," emphasizing that such disclosures underscore the importance of strict legal firewalls.