As stated in an earlier column, the IRS historically has not shared tax information with the Department of Homeland Security (DHS) for immigration enforcement purposes. This is because an immigrant’s tax information may not be relevant to the enforcement of immigration laws. Also, promises of nondisclosure encourage undocumented aliens to file tax returns and pay income and payroll taxes. Lastly, the IRS may not be legally allowed to divulge tax information.
The IRS recently declined Immigration and Customs Enforcement’s (ICE) request for addresses of 700,000 people suspected of being in the country illegally, citing privacy laws.
But a few days ago, the Washington Post reported that the IRS and ICE are trying to reach an agreement to allow immigration staff to use tax data to confirm the names and addresses of people suspected of being in the country illegally.
It is believed that the agreement would only ask for addresses of immigrants who already have final removal orders. Also, Homeland Security Secretary Kristi Noem and acting ICE director Todd Lyons will be the only people authorized to make these requests.
President Donald Trump has taken unprecedented steps using every federal resource to combat illegal immigration. If an agreement is reached, it would mark the first time that the IRS has helped enforce immigration laws.
Under federal law, specifically I.R.C. Section 6103, IRS staff are forbidden to disclose tax returns or information documents such as W-2s or 1099s to third parties, which includes other government agencies. This code section was used by the Democrat-controlled House Ways and Means committee to obtain the tax returns from then former President Trump, despite his objections.
But there are numerous exceptions. The most relevant ones are disclosure for the purpose of assisting criminal investigations or for investigating terrorist activities. However, the information can only be disclosed with an order from a federal judge. In determining whether to issue this order, the judge must review whether there is reasonable cause that a federal crime has been committed, whether the tax information requested is relevant to the crime committed, and whether the information cannot reasonably be obtained from another source.
Also, the president can request tax information on any taxpayer upon written request.
While the scope of the rumored agreement is limited to those who have already been ordered to leave the country, it could be expanded to meet Trump’s campaign promise of substantially reducing illegal immigration.
Illegal entry into the United States is technically a federal crime and so it could be possible to obtain tax information using the criminal investigation exception to nondisclosure. But in most cases, illegal entry cases have been enforced civilly through deportation proceedings.
Considering the millions of undocumented aliens currently living in the U.S., obtaining tax records of the ones that file could be quite the undertaking for the IRS. Especially considering that the agency has laid off its probationary employees and plans to cut its workforce by 15,000.
Federal judges may be skeptical about granting large-scale disclosure orders mainly because the DHS and ICE have been able to find the locations of aliens through other means.
Some undocumented immigrants may consider not filing tax returns if a disclosure agreement is reached. But this creates more problems. They could lose out on tax refunds. They may not be eligible for cancellation of removal if they are placed in deportation proceedings.
Lastly, willfully failing to file a tax return is also a crime. Generally, it is enforced in extreme cases, but it is possible that the Department of Justice could prosecute this crime more liberally under Trump and Attorney General Pam Bondi.
The news of this agreement itself along with Trump’s other immigration-related actions and rhetoric since his inauguration has had an effect on illegal border crossings. A White House press release stated that since Trump took office, migrants apprehended at ports of entry declined by 93%. However, the decrease in migration could also be attributable to former president Joe Biden’s agreement with Mexico in March 2024.
Steven Chung is a tax attorney in Los Angeles, California. He helps people with basic tax planning and resolve tax disputes. He is also sympathetic to people with large student loans. He can be reached via email at stevenchungatl@gmail.com. Or you can connect with him on Twitter (@stevenchung) and connect with him on LinkedIn.
The post Can The IRS Legally Disclose Taxpayer Information To DHS To Deport Undocumented Aliens? appeared first on Above the Law.
As stated in an earlier column, the IRS historically has not shared tax information with the Department of Homeland Security (DHS) for immigration enforcement purposes. This is because an immigrant’s tax information may not be relevant to the enforcement of immigration laws. Also, promises of nondisclosure encourage undocumented aliens to file tax returns and pay income and payroll taxes. Lastly, the IRS may not be legally allowed to divulge tax information.
The IRS recently declined Immigration and Customs Enforcement’s (ICE) request for addresses of 700,000 people suspected of being in the country illegally, citing privacy laws.
But a few days ago, the Washington Post reported that the IRS and ICE are trying to reach an agreement to allow immigration staff to use tax data to confirm the names and addresses of people suspected of being in the country illegally.
It is believed that the agreement would only ask for addresses of immigrants who already have final removal orders. Also, Homeland Security Secretary Kristi Noem and acting ICE director Todd Lyons will be the only people authorized to make these requests.
President Donald Trump has taken unprecedented steps using every federal resource to combat illegal immigration. If an agreement is reached, it would mark the first time that the IRS has helped enforce immigration laws.
Under federal law, specifically I.R.C. Section 6103, IRS staff are forbidden to disclose tax returns or information documents such as W-2s or 1099s to third parties, which includes other government agencies. This code section was used by the Democrat-controlled House Ways and Means committee to obtain the tax returns from then former President Trump, despite his objections.
But there are numerous exceptions. The most relevant ones are disclosure for the purpose of assisting criminal investigations or for investigating terrorist activities. However, the information can only be disclosed with an order from a federal judge. In determining whether to issue this order, the judge must review whether there is reasonable cause that a federal crime has been committed, whether the tax information requested is relevant to the crime committed, and whether the information cannot reasonably be obtained from another source.
Also, the president can request tax information on any taxpayer upon written request.
While the scope of the rumored agreement is limited to those who have already been ordered to leave the country, it could be expanded to meet Trump’s campaign promise of substantially reducing illegal immigration.
Illegal entry into the United States is technically a federal crime and so it could be possible to obtain tax information using the criminal investigation exception to nondisclosure. But in most cases, illegal entry cases have been enforced civilly through deportation proceedings.
Considering the millions of undocumented aliens currently living in the U.S., obtaining tax records of the ones that file could be quite the undertaking for the IRS. Especially considering that the agency has laid off its probationary employees and plans to cut its workforce by 15,000.
Federal judges may be skeptical about granting large-scale disclosure orders mainly because the DHS and ICE have been able to find the locations of aliens through other means.
Some undocumented immigrants may consider not filing tax returns if a disclosure agreement is reached. But this creates more problems. They could lose out on tax refunds. They may not be eligible for cancellation of removal if they are placed in deportation proceedings.
Lastly, willfully failing to file a tax return is also a crime. Generally, it is enforced in extreme cases, but it is possible that the Department of Justice could prosecute this crime more liberally under Trump and Attorney General Pam Bondi.
The news of this agreement itself along with Trump’s other immigration-related actions and rhetoric since his inauguration has had an effect on illegal border crossings. A White House press release stated that since Trump took office, migrants apprehended at ports of entry declined by 93%. However, the decrease in migration could also be attributable to former president Joe Biden’s agreement with Mexico in March 2024.
Steven Chung is a tax attorney in Los Angeles, California. He helps people with basic tax planning and resolve tax disputes. He is also sympathetic to people with large student loans. He can be reached via email at [email protected]. Or you can connect with him on Twitter (@stevenchung) and connect with him on LinkedIn.
