The IRS-ICE data-sharing agreement signed on April 7, 2025, is a historic and controversial shift in U.S. tax and immigration policy. It has broad implications for how information returns—including Forms 1042-S, 1099, and W-2—are filed, verified, and enforced.
Overview of the Agreement
-
Signed by: Treasury Secretary Scott Bessent and DHS Secretary Kristi Noem
-
Effective Date: April 7, 2025
-
What it does: Authorizes Immigration and Customs Enforcement (ICE) to access select IRS taxpayer data, including:
-
Tax filings using ITINs (Individual Taxpayer Identification Numbers)
-
Information returns like 1042-S, 1099 series, and W-2
-
Withholding data and treaty benefit claims
-
-
Trigger Conditions: Applies in cases where ICE is pursuing immigration enforcement against individuals with final deportation orders or criminal investigations involving fraud or identity misuse.
Why the IRS-ICE Agreement Affects Information Returns
Tax Data Can Now Trigger Immigration Enforcement
-
The IRS is sharing tax data—including information return data—with ICE.
-
If someone files a return or is listed on a form (like a 1042-S or 1099) using an ITIN or a possibly false SSN, ICE can now use that to:
-
Track income and employment
-
Check if someone is violating immigration laws (e.g., overstaying a visa, working without authorization)
-
Information returns are forms that report who got paid, how much, and whether taxes were withheld. This agreement between ICE and the IRS makes information returns a tool for immigration enforcement.