Judge: IRS Broke the Law Over 42,000 Times by Sharing Data with Immigration Authorities

Federal District Judge Ana Reyes issued a landmark ruling on Thursday, finding that the Internal Revenue Service (IRS) broke federal law tens of thousands of times by sharing taxpayer data with immigration authorities. The judge stated that the IRS illegally provided information on approximately 42,695 individuals to ICE (Immigration and Customs Enforcement) and other components of the Department of Homeland Security (DHS), despite no suspicion of tax offenses against these individuals. This practice, which intensified during the administration of President Donald Trump and continued under Joe Biden, constituted a serious violation of the Tax Reform Act of 1976. This law strictly limits the ability to share tax information with other federal agencies, requiring law enforcement to provide justification that the data is relevant to a tax investigation.

The Tax Reform Act of 1976 was passed after the Watergate scandal, which revealed abuses of executive power, including the use of tax data for political purposes. The law was intended to create strong privacy safeguards for taxpayers and prevent the political misuse of financial information by the government. Since then, it has been considered one of the cornerstones of protecting citizens' privacy from excessive government surveillance. Judge Reyes, in her 66-page opinion, unequivocally stated that the IRS acted unlawfully, and the agency's reliance on secret executive regulations does not constitute justification. "The IRS cannot evade compliance with a law passed by Congress by citing internal procedures or interpretations," wrote Reyes. The ruling is the result of a class-action lawsuit filed by several citizens and the ACLU Foundation (American Civil Liberties Union), who argued that their constitutional right to privacy had been violated. The lawsuit demonstrated that the IRS regularly provided ICE with complete tax files, including returns, income information, family status, and residence, based on requests that did not meet the standards set by the Act. These requests primarily concerned individuals identified by ICE as potential illegal immigrants.

Judge Reyes's decision sets an important legal precedent that strengthens taxpayer data protection and may lead to significant changes in inter-agency cooperation practices. The ruling not only confirms the violation of law but also undermines the government's argument that such actions are necessary for national security. Consequently, sanctions may be imposed on the IRS, or procedural changes may be ordered, although the judge has not yet issued a decision on remedies. The case highlights the broader problem of excessive collection and sharing of citizen data among government agencies, raising concerns about the erosion of civil rights in the digital age. An IRS spokesperson declined to comment on the ongoing proceedings.