Fact Check: A federal judge refused to block the Internal Revenue Service from sharing immigrants’ tax data with Immigration and Customs Enforcement.

Fact Check: A federal judge refused to block the Internal Revenue Service from sharing immigrants’ tax data with Immigration and Customs Enforcement

What We Know

On May 12, 2025, U.S. District Judge Dabney Friedrich ruled against a preliminary injunction that sought to prevent the Internal Revenue Service (IRS) from sharing tax data of immigrants with Immigration and Customs Enforcement (ICE) for the purpose of identifying and deporting individuals living illegally in the United States. The ruling was seen as a significant legal victory for the Trump administration, which has been advocating for stricter immigration enforcement measures (AP News, CNN).

The IRS has historically maintained that tax information is confidential, especially for undocumented immigrants who file taxes. However, the recent agreement allows ICE to request tax data for individuals it suspects of being in the country illegally, provided it meets certain legal criteria (Budget Lab, Immigration Forum).

In 2023, unauthorized immigrants were estimated to have contributed approximately $66 billion in federal income and payroll taxes, which raises concerns about the potential impact of this data-sharing agreement on tax compliance among this population (Budget Lab).

Analysis

The ruling by Judge Friedrich has sparked considerable debate regarding privacy rights and the implications for undocumented immigrants. The plaintiffs, consisting of various nonprofit groups, argued that undocumented immigrants deserve the same privacy protections as U.S. citizens. However, the judge determined that the IRS's actions did not violate the Internal Revenue Code and that the agency was operating within its legal framework to assist in criminal investigations (AP News, CNN).

Critics of the agreement, including immigrant rights advocates, express concern that the sharing of tax data could deter undocumented immigrants from filing taxes, potentially leading to a decrease in federal tax revenues. The Budget Lab estimates that such an agreement could result in a loss of up to $313 billion in federal revenue over the next decade due to reduced tax compliance (Budget Lab). This concern is compounded by the historical context that many undocumented immigrants already contribute significantly to the tax system, often without receiving benefits in return (Budget Lab).

The credibility of the sources involved in this discussion varies. The AP and CNN are established news organizations with a reputation for factual reporting, while the Budget Lab is a research initiative that provides data-driven insights. The nonprofit groups involved in the lawsuit may have a vested interest in the outcome, which could introduce bias into their arguments (AP News, CNN, Budget Lab).

Conclusion

The claim that a federal judge refused to block the IRS from sharing immigrants’ tax data with ICE is True. The ruling by Judge Friedrich confirms that the IRS is permitted to share tax information with ICE under specific legal conditions, which has significant implications for undocumented immigrants and their willingness to file taxes. The potential economic impact of this agreement raises further questions about the balance between immigration enforcement and taxpayer privacy.

Fact Check: A federal judge refused to block the Internal Revenue Service from sharing immigrants’ tax data with Immigration and Customs Enforcement.