TL;DR: In April 2025, Treasury Secretary Scott Bessent and DHS Secretary Kristi Noem signed a deal letting ICE cross-check names against IRS tax records. On August 6, 2025, ICE submitted 1.28 million names. The IRS responded the next day with data on 47,000 matches, and improperly shared addresses for roughly 2,350 people whose records shouldn't have been disclosed at all. Two federal judges have now blocked the program: one in D.C. in November 2025, and one in Massachusetts on February 5, 2026. The IRS calls it an administrative error. The judge called it "irreparable harm."
The Deal Nobody Was Supposed to See
On April 7, 2025, Bessent and Noem signed a Memorandum of Understanding that turned the IRS into an immigration enforcement tool. The deal was straightforward: ICE sends names and addresses of people it believes are in the country illegally. The IRS checks those names against its tax records. Matches get sent back to ICE.[1]
The legal basis? A narrow exception in Section 6103 of the Internal Revenue Code, one of the strongest privacy protections in federal law. Section 6103 makes it a felony to disclose taxpayer information without authorization. The exception Bessent's team used was designed for specific, targeted law enforcement requests. Not for bulk data dumps of 1.28 million names.[2]
On August 6, 2025, ICE submitted its first batch: 1.28 million names and addresses. The IRS turned it around in one day: by August 7, ICE had data on approximately 47,000 confirmed matches.[1][3]
One day. 1.28 million names processed. 47,000 people identified to an agency that arrests people at their homes.
The "Accident" That Exposed Thousands
On February 12, 2026, a sworn declaration from IRS Chief Risk and Control Officer Dottie Romo revealed something the agencies had known since January: for roughly 5% of the 47,000 matches (about 2,350 people) the IRS shared address information it shouldn't have.[1]
The problem: ICE's submitted address field was "either incomplete or insufficiently populated" for those individuals. Under the agreement's own terms, incomplete address data shouldn't trigger a response. The IRS shared home addresses anyway.[1][3]
The agency framed it as an administrative error. Treasury notified DHS in January and asked them to stop using the improperly shared data and to "promptly take steps to remediate the matter consistent with federal law."[1]
Here's the problem with calling this an "accident": the data was stored on an individual ICE employee's computer. Judge Indira Talwani ruled that this storage alone "constitutes impermissible storage" under the Internal Revenue Code. There's no verified chain of custody for where the data went after that.[2][4]
Two Judges. Same Conclusion: This Is Illegal.
The first ruling came in November 2025. Judge Colleen Kollar-Kotelly of the U.S. District Court for the District of Columbia blocked the IRS from sharing taxpayer addresses with ICE. That case is now on appeal to the D.C. Circuit.[2]
The second ruling landed on February 5, 2026. Judge Talwani in Massachusetts went further. Her 42-page order didn't just block address sharing: it blocked the entire program. DHS Secretary Noem, ICE Acting Director Todd Lyons, and all their agents were barred from "inspecting, viewing, using, copying, distributing, relying on, or otherwise acting upon any return information" obtained through the agreement.[2][4]
Talwani found that the four plaintiff organizations (community groups that help immigrants file taxes and access legal services) demonstrated "irreparable harm." Her reasoning cut to the core: if people believe filing taxes will get them arrested, they'll stop filing. The agreement created a "chilling effect" on tax compliance.[2]
She also noted something chilling buried in DHS's own legal briefs: DHS General Counsel had suggested that "illegal aliens aren't entitled to the same Fourth Amendment protections."[2]
The judge gave ICE until February 10 to confirm that the employee holding the data had received the court order. Whether that data was already copied, forwarded, or used before then is unknown.[4]
Section 6103: The Privacy Law They Tried to Hollow Out
Section 6103 exists because the government learned the hard way that tax data is dangerous in the wrong hands. Nixon used IRS files to target political enemies. The law was written to make sure that never happened again.[5]
The rule is simple: taxpayer information is confidential. Period. The IRS can't share it with other agencies, private entities, or citizens except through narrow, specific exceptions. Violating Section 6103 is a federal crime: up to five years in prison and a $5,000 fine per offense.[5]
The Bessent-Noem deal tried to squeeze a mass surveillance program through a keyhole exception meant for targeted law enforcement requests. When ICE drops 1.28 million names on the IRS's desk and gets 47,000 hits back in 24 hours, that's not a targeted request. That's a dragnet.[2]
Tom Bowman at the Center for Democracy & Technology put it bluntly: "The improper sharing of taxpayer data is unsafe, unlawful, and subject to serious criminal penalties."[1]
The Damage Is Already Done
Even with two court orders blocking the program, the chilling effect is real. Lisa Gilbert of Public Citizen warned: "If federal agents use this private information...it can endanger lives."[1]
Immigrant communities are already pulling back from filing taxes. The plaintiff organizations told the court they "cannot encourage the filing of tax returns that may result in ICE arresting" household members.[2]
That's not hypothetical. ICE has been conducting raids at homes, churches, and workplaces throughout 2025 and 2026. Adding IRS-verified home addresses to ICE's target list gives agents something they've always wanted: a government-confirmed address for millions of people they want to find.
The IRS collects taxes from everyone who earns money in the United States, regardless of immigration status. That's been the deal for decades: you work, you pay taxes, your tax information stays confidential. Breaking that promise doesn't just violate one privacy law. It breaks the system that funds the government in the first place.
The IRS Is Just One Pipeline
This isn't happening in isolation. The DOGE operation at the SSA copied 300 million Social Security records to an unauthorized server. The SAVE database expansion opened bulk citizenship queries across agencies. A March 2025 executive order titled "Eliminating Information Silos" requires agencies to share data with each other and with the White House.[6]
The IRS-ICE deal is one piece of a larger pattern: every federal database that knows where you live, what you earn, who you're related to, or what your immigration status is, being connected into an enforcement pipeline. Tax returns. Social Security records. Employment verification. Voter rolls. Benefits data.
Each deal gets challenged. Each gets blocked by a judge. And each gets replaced by a new workaround.
What You Can Do
Still File Your Taxes
Not filing creates bigger legal problems. Two federal courts have blocked this program. The data-sharing agreement is stayed. Filing remains the safest path, but consult an immigration attorney if you have concerns.
Get an IRS Identity Protection PIN
An IP PIN prevents anyone else from filing taxes using your Social Security number. Free at irs.gov. Takes 10 minutes.
Know Your Rights
ICE cannot legally use data obtained through this agreement right now. If agents reference tax data during an encounter, that's potentially illegal evidence. Document everything.
Support Legal Challenges
Organizations like the Center for Democracy & Technology and Public Citizen are fighting these agreements in court. The cases aren't over: the government is appealing both rulings.
References
- PBS News: Data of thousands of taxpayers wrongly shared with DHS, court filing says (February 12, 2026)
- FedScoop: Federal judge blocks ICE from using IRS taxpayer data in enforcement (February 5, 2026)
- Tax Notes: IRS Erroneously Shared Taxpayer Info With ICE (February 12, 2026)
- National Law Review: Federal Judge Says ICE Prohibited from Using IRS Data for Enforcement (February 2026)
- Tax Notes: Court Orders IRS to Stop Sharing Taxpayer Data With ICE (2026)
- FedScoop: Trump orders full access to agency data for designated officials (March 21, 2025)