Judge Dabney Friedrich just handed President Trump a major victory by ruling that the IRS can legally share information on illegal immigrants with the Department of Homeland Security, strengthening the administration’s immigration enforcement strategy despite fierce opposition from activist groups.
Key Takeaways
- A federal judge ruled that the IRS-DHS data-sharing agreement does not violate the Internal Revenue Code, allowing immigration enforcement to access certain tax information.
- The April 2025 Memorandum of Understanding between agencies permits ICE to cross-check suspected illegal immigrants’ information against tax records for criminal investigations.
- Former acting IRS commissioner Melanie Krause resigned over the controversial data-sharing arrangement.
- While ICE leadership claims the information will be used only for “major criminal cases,” critics argue it will discourage tax compliance among immigrant communities.
- The court determined that basic taxpayer identity information is not considered protected tax return data under federal law.
Trump Administration Secures Legal Win for Enhanced Immigration Enforcement
The Trump administration’s immigration enforcement strategy received a substantial boost when D.C. District Court Judge Dabney Friedrich denied a preliminary injunction that sought to block information sharing between the Internal Revenue Service and Department of Homeland Security. The lawsuit, filed by Centro de Trabajadores Unidos against Treasury Secretary Scott Bessent, challenged a Memorandum of Understanding signed on April 7, 2025, which established formal procedures for the agencies to exchange certain taxpayer information for criminal investigations related to immigration enforcement.
In her ruling, Judge Friedrich emphatically stated the legality of the agreement: “At its core, this case presents a narrow legal issue: Does the Memorandum of Understanding between the IRS and DHS violate the Internal Revenue Code? It does not.” The decision represents a significant victory for President Trump’s broader immigration enforcement agenda, which includes intensified workplace enforcement and deportation efforts targeting those illegally present in the United States.
Scope and Limitations of Tax Data Sharing
The court documents clarify that while tax information is generally confidential with criminal penalties for improper disclosure, federal law does allow the IRS to share certain data with law enforcement agencies under specific conditions. Judge Friedrich determined that the agreement utilizes existing legal tools for criminal investigations and does not exceed statutory authority. According to the ruling, the IRS can disclose information obtained through audits, though not data exclusively from taxpayer filings.
“Information will only be used by officers and employees of ICE solely for the preparation for judicial or administrative proceedings, or investigation that may lead to such proceedings,” states one court document cited in the case.
Significantly, the judge also ruled that basic identity information, including names and addresses of taxpayers, is not considered protected tax return information under federal statutes. This determination gives ICE broader access to identifying data that could prove crucial for immigration enforcement operations while still maintaining protections around sensitive financial information.
Internal Resistance and External Criticism
The data-sharing arrangement has not been without controversy, even within the federal government. Former acting IRS commissioner Melanie Krause resigned over the agreement, underscoring the significant internal tensions the policy has created. ICE leadership has sought to downplay concerns by insisting the information would be used “strictly for the major criminal cases,” though critics remain unconvinced about how narrowly the authority will be exercised.
“[Disclosing immigrant tax records to DHS for immigration enforcement] will discourage tax compliance among immigrant communities, weaken contributions to essential public programs, and increase burdens for U.S. citizens and nonimmigrant taxpayers,” Tom Bowman said.
Civil liberties advocates have expressed alarm over the potential for privacy violations and argue that the arrangement creates a dangerous precedent. The plaintiffs are considering their legal options following the ruling. Alan Butler Morrison, representing the plaintiffs, stated, “The plaintiffs are disappointed in the Court’s denial of our preliminary injunction, but the case is far from over. We are considering our options.” Morrison added that they would monitor DHS and IRS compliance with legal limitations.
Transparency and Future Implications
In a related decision, Judge Friedrich denied American Oversight’s motion to intervene in the case but ordered most of the Memorandum of Understanding and related briefs unsealed. The court found no compelling interest in keeping the agreement fully sealed, except for protecting the privacy of lower-level government employees, enhancing transparency around this consequential policy change.
This ruling represents another significant legal victory for President Trump’s administration as it implements stronger border security and immigration enforcement measures. While the data-sharing agreement is now legally permitted to proceed, watchdog groups indicate they will continue monitoring how the agencies implement the information exchange and whether they adhere to the legal limitations established in the court’s decision.
Sources:
- Trump Admin. Scores Another Court Win As Federal Judge Rules IRS May Share Illegal Alien Data With DHS – RedState
- Trump admin gets a win as judge allows IRS to share tax data with ICE
- Judge refuses to block IRS from sharing tax data to identify people illegally in U.S. : NPR
