IRS improperly disclosed taxpayer data to DHS officials, court filing shows

The Internal Revenue Service improperly disclosed the confidential taxpayer information of thousands of people to the Department of Homeland Security as part of the agencies’ controversial agreement to share data on immigrants to help identify those living in the country illegally, according to a new court filing.

The Treasury Department, IRS and Department of Homeland Security finalized an agreement last spring to allow taxpayer data to be shared with immigration authorities to help them track down illegal immigrants.

The deal, which led to the resignations of top IRS officials, authorized Immigration and Customs Enforcement to submit the names and addresses of illegal immigrants to the IRS for cross-checking against tax records.

In a statement filed Wednesday, Dottie Romo, IRS chief risk and compliance officer, said the IRS was able to verify about 47,000 of the 1.28 million names requested by ICE that were later released to the immigration enforcement agency.

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The Internal Revenue Service improperly disclosed the tax information of thousands of people to the Department of Homeland Security. (Getty Images)

The IRS gave ICE additional address information for less than 5% of those names, potentially violating privacy rules created to protect taxpayer data.

The tax collection agency said it recently discovered the error and is working with other federal agencies to resolve the problem.

Romo said Treasury notified DHS of the error last month and requested its assistance in “promptly taking steps to remedy the problem in accordance with federal law,” which includes “properly disposing of all data provided to ICE by the IRS based on incomplete or insufficient address information.”

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The Treasury Department, IRS and Department of Homeland Security finalized an agreement last spring to allow taxpayer data to be shared with immigration authorities. (Victor J. Blue/Bloomberg via Getty Images)

Last year’s agreement between the IRS and DHS sparked litigation against the Trump administration and broke a longstanding IRS policy that encouraged immigrants to pay taxes even if they are not legally in the United States by assuring them that their data was safe.

A lawsuit was filed against Treasury Secretary Scott Bessent and Homeland Security Secretary Kristi Noem on behalf of several immigrant rights groups shortly after the deal was signed.

Last week, a federal judge ordered the IRS to stop disclosing residential addresses to ICE, marking the second ruling blocking the IRS-DHS deal.

In November, another federal judge blocked the IRS from sharing information with DHS, saying the IRS illegally released some migrants’ tax data over the summer, violating a taxpayer privacy law.

A lawsuit was filed against Treasury Secretary Scott Bessent and Homeland Security Secretary Kristi Noem on behalf of several immigrant rights groups shortly after the deal was signed. (Joe Raedle/Getty Images)

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Advocacy groups have expressed concern that the potential illegal disclosure of taxpayer records could be used to maliciously target U.S. citizens and violate their privacy.

“Once taxpayer data is open to immigration officials, mistakes are inevitable and consequences fall on innocent people,” Tom Bowman, policy advisor at the Center for Democracy & Technology, told the Associated Press. “The disclosure of thousands of confidential documents unfortunately shows precisely why strict legal firewalls exist and have – until now – been treated as an important safeguard.”

The Associated Press contributed to this report.