The Center for Democracy & Technology (CDT), along with over 270 organizations, has expressed concerns over taxpayer privacy regarding a new Memorandum of Understanding (MOU) between the Internal Revenue Service (IRS) and the Department of Homeland Security (DHS). The MOU allows for the sharing of taxpayer information concerning approximately seven million individuals suspected of being undocumented.
The organizations' joint letter criticizes the MOU, emphasizing that taxpayers will receive no prior notice about the sharing of their information, nor will they have the chance to contest the disclosure beforehand. UnidosUS, a civil rights advocacy NGO leading the effort, stated that the MOU “...poses an unprecedented threat to taxpayer privacy protections that have been respected on a bipartisan basis for nearly 50 years.”
The letter argues that the sharing of taxpayer data with DHS for immigration enforcement is not sanctioned by existing taxpayer privacy laws. It calls for Congress to engage in oversight hearings, demand a non-redacted release of the MOU, and require that the Treasury Department provide clarification on its interpretation of related laws.
CDT highlights that taxpayer privacy plays a crucial role in ensuring compliance. They argue that utilizing taxpayer data for immigration enforcement might deter undocumented individuals from filing returns, potentially pushing them towards the informal labor market and leading to significant losses in tax revenue. CDT notes that the IRS had previously assured undocumented citizens that their tax information would not be used for immigration purposes, raising concerns about the reliability of such assurances given the recent developments.
The coalition's letter urges Congress to take action to protect taxpayer privacy and address these issues.