IRS Chief Resigns Amid Uproar Over Immigrant Data Sharing Deal
Acting IRS Commissioner Melanie Krause is stepping down following backlash over a new agreement that allows immigration officials access to tax records of undocumented immigrants. Signed by Treasury Secretary Scott Bessent and Homeland Security Secretary Kristi Noem, the deal enables ICE to match names and addresses against IRS data to track down individuals living in the U.S. illegally—despite warnings from IRS attorneys that it likely violates privacy laws. Krause reportedly learned of the final agreement from the news, having been bypassed in the final stages.
Krause becomes the third IRS leader to leave this year, joining predecessors Doug O’Donnell and Danny Werfel, both of whom resigned under pressure tied to the Trump administration’s efforts to reshape the federal workforce. Sources familiar with Krause’s decision said the controversial data-sharing deal, mounting legal concerns, and a wave of senior staff departures pushed her to accept a deferred resignation offer. The agency is also undergoing mass layoffs tied to Elon Musk’s Department of Government Efficiency, with up to 25% of IRS staff set to be cut.
Critics, including privacy advocates and legal scholars, argue the agreement undermines taxpayer confidentiality and could have chilling effects on compliance. “It sets a dangerous precedent for data privacy abuse,” said one policy expert. Meanwhile, ICE officials claim the data will help target serious offenders, but concerns remain that the agreement could affect broader communities and violate long-standing federal protections.
