IRS chief resigning after ICE deal on taxpayer data

What happened

Acting IRS Commissioner Melanie Krause is stepping down, along with several other top officials at the tax agency, after Treasury Secretary Scott Bessent signed a deal with Homeland Security Secretary Kristi Noem that forces the IRS to share protected taxpayer records with Immigration and Customs Enforcement to further President Donald Trump's deportation drive, news organizations said Tuesday.

Who said what

Bessent and Noem signed the deal Monday, even after "IRS lawyers had counseled" that the plan "probably violates privacy law," but Krause only learned of it when Treasury representatives "released it to Fox News," The Washington Post said.

Krause was once seen as "aligned with Elon Musk's" DOGE but had become "uncomfortable with the direction of the IRS under the Trump administration," The New York Times said. She is the third IRS chief to leave during Trump's first three months in office. Her predecessor, Doug O’Donnell, "retired rather than clash with DOGE and immigration enforcement officials" seeking "broad access to confidential personal taxpayer data," the Post said.

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The administration argued that ICE can access tax data for anyone who committed the crime of defying a court order to leave the U.S. Using "immigrants' tax data against them should send chills down the spine of every U.S. taxpayer who disagrees with this administration," said Lisa Gilbert of Public Citizen.

What next?

After years of IRS privacy guarantees, the data-sharing agreement will "discourage undocumented immigrants from paying taxes," Axios said, costing the government tens of billions of dollars a year in lost revenue and Social Security taxes.