Aug. 19, 2025, 6:30 p.m.
For immigrants in the U.S. attempting to avoid deportation but still trying to play by the rules as best they can, the masked federal officers roaming the streets aren’t their only worry. It turns out the records they provided the government, such as tax and medical information, could be their undoing now that the Trump administration is using that data to locate them and their families.
“We’re talking about folks who disclose their private information for the purposes of paying taxes to comply with U.S. law,” said Laura Rivera, an immigration lawyer with Just Futures Law. “Having that data used now, for purposes completely unrelated to that—in effect, to police and arrest and deport them—that’s a huge risk and a big violation of the privacy rights of individuals.”
Rivera warned that a data-sharing agreement between the IRS and the Homeland Security Department will sow distrust against the federal government, as people’s personal data is no longer private.
In April, the IRS and DHS established a memorandum of understanding allowing immigration enforcement to access taxpayer information. Critics have said the MOU violates privacy law, and the federal data sharing is currently being challenged in court.
More recently, Immigration and Customs Enforcement gained access in July to Medicaid data through an agreement signed between DHS and the Centers for Medicare and Medicaid Services. As reported by the Associated Press, that information includes home addresses and ethnicities of individuals.
Experts and immigration advocates say this large-scale data-sharing operation between federal agencies is unprecedented. According to DHS, the agreements are meant to help immigration enforcement find, track, detain, and deport those without legal immigration status.
‘A chilling effect’
Immigration lawyers, including Rivera, expressed concern that the sharing of data will hurt the immigrant community, exacerbating the sense of fear already heightened by ICE raids and street arrests by giving data to the federal government, which may then be used to hunt them down.
Petra Molnar, a lawyer specializing in migration technology, said people might stop filing taxes or seeking medical care, fearful that registering their presence will be used against them.
“People at risk of their data being shared like this may avoid, for example, filing taxes, even if they’re eligible, or enrolling in Medicaid or accessing health care even though they are legally entitled to, because of this fear of surveillance and data sharing,” Molnar said.
Francine Lipman, a tax-law professor at the University of Nevada-Las Vegas, said the DHS-IRS MOU is likely to dissuade undocumented immigrants from filing taxes, which would be a hit to the U.S. Treasury.
“I would suspect one ramification would be to push this back into the cash economy, which undermines tax compliance and revenue going to the state and federal government,” Lipman said. “It has a chilling effect on tax compliance, which is very expensive for the Treasury.”
Mixed-status households
It’s a harrowing and confusing new reality for those in the immigrant community. According to Molnar and Rivera, it’s uncommon for entire households to be undocumented. Usually, immigrants are in mixed-status households. This could mean one parent is documented, one is undocumented, and the children are documented. It could also mean both parents are undocumented but the children are documented, or any other combination of statuses.
Mixed-status families might have some members eligible for benefits such as food stamps or Medicaid. When individuals file for these benefits, entire household data is often reported—even if not every family member is receiving them.
Though they generally cannot access most federal benefit programs, undocumented immigrants pay into entitlement programs such as Social Security through their employers and they file taxes, transactions that create a paper trail of identifying information.
While undocumented individuals generally contribute more than they receive in government benefits, some conservative economists say their U.S.-born children—who automatically become citizens at birth—can be a net drain on the Treasury because they go to public schools and are entitled to federal health care and food assistance their parents cannot access.
With access to IRS and CMS data, immigration-enforcement authorities are now able to get information that was previously off-limits, putting members of mixed-status families at risk of deportation.
“It will create a chilling effect on people’s ability to feel free and safe to interact with state services, and that’s, I think, regardless of your immigration status,” Molnar said. “Because, again, it might first impact people in the migration space, but it weakens the expectation that people have when they interact with state agencies.”
The expectation of privacy
Federal privacy laws put strict limits on the ability of federal agencies, such as the IRS, to share individuals’ personal information. Currently, IRS data sharing is restricted to specific circumstances. What is now being litigated is whether the MOU, issued in April, falls in line with those existing exemptions.
Currently, DHS can access the information of a taxpayer who is under an active criminal investigation, regardless of their immigration status.
Immigration advocates doubt ICE is carrying out criminal investigations on each taxpayer for whom they are seeking information.
“The data sharing that’s completed under the current memorandum of understanding between the IRS and DHS really threatens the protections that Congress put in place so long ago,” Rivera said. “Supposedly, under this MOU, the DHS is claiming to be able to access home address information of taxpayers under an exception for criminal investigations, but we have to question whether that exception justifies the scope of the searches that the Trump administration has said publicly they want to make into this data.”
Rivera is not the only person to question the implementation of the MOU. A ProPublica investigation published in July quoted multiple former IRS officials doubting the ability of ICE to simultaneously conduct 7 million criminal investigations. There were an estimated 11 to 13 million undocumented immigrants in the U.S. between 2022 and 2023.
The case Centro de Trabajadores Unidos v. Bessent was filed in March with the aim of preventing the IRS from sharing taxpayer information with DHS and ICE. In May, a court denied the request to keep ICE from accessing IRS records, on the basis that the IRS could share data with ICE if it was regarding an active criminal investigation. The case is currently being appealed in court.
DHS isn’t the only federal organization trying to weaken privacy protections. On Aug. 12, a federal appeals court ruled that the Department of Government Efficiency could access Social Security benefit information for millions of Americans. This includes sensitive financial information, as well as addresses that could be used for identification purposes.
