The Internal Revenue Service’s (IRS) acting director is reportedly stepping down over the prospect of sharing illegal immigrants’ tax data with Immigration and Customs Enforcement (ICE) to apprehend those who entered the country illegally.
President Donald Trump unveiled the plan in March, announcing that an agreement between the Department of Homeland Security (DHS) and the IRS would enable ICE to request information on people suspected of living in the country illegally.
As the deal is being finalized, Acting IRS Commissioner Melanie Krause will be leaving the Trump administration, according to The Washington Post.
Acting IRS commissioner Melanie Krause — the tax agency’s third leader since President Donald Trump’s inauguration — will participate in the deferred resignation program the Trump administration offered to agency employees in recent days, said the people, who spoke on the condition of anonymity for fear of reprisal.
Disagreements over the agency’s direction also factored into Krause’s decision to leave, the people said.
Losing three agency leaders in three months is “unprecedented,” one of the people said. “I don’t think we’ve seen anything like this at IRS.”
Treasury Department officials in recent days sought to circumvent IRS executives so immigration authorities could access private taxpayer information, the people said. Those conversations largely excluded Krause’s input.
Krause learned about the deal after the Treasury Department released the details to Fox News.
The acting commissioner grew frustrated at her inability to push back against the Department of Government Efficiency’s (DOGE) efforts to cut staff while overhauling the agency’s technology infrastructure. A source told The Post that Krause “no longer feels like she’s in a position where she can impact the decision-making that’s happening.”
🚨 BREAKING: Melanie Krause, acting IRS commissioner, will resign after the agency agreed to share Illegal Aliens’ tax data with DHS for enforcement.
— Publius (@OcrazioCornPop) April 9, 2025
Hired in October 2021 under Biden as Chief Data & Analytics Officer, she implemented AI and analytics to help the IRS extort… pic.twitter.com/UuKi92fWAI
Krause is not the first acting director to resign due to the Trump administration’s agenda, NBC News noted.
The IRS has been in upheaval over Trump administration decisions to share taxpayer data. Acting Commissioner Douglas O’Donnell announced his retirement from the agency after roughly 40 years of service in February as furor spread over Elon Musk’s Department of Government Efficiency gaining access to IRS taxpayer data. Krause replaced him.
President Trump in February announced plans to have IRS agents aid in the administration’s mass deportation efforts. Earlier, he had suggested sending almost 90,000 agents to the southern border to help immigration authorities round up illegal aliens trying to gain entry into the country.
A memo dated February 7 revealed that Homeland Security Secretary Kristi Noem tasked Treasury Secretary Scott Bessent with deputizing law enforcement personnel, including IRS agents, to aid in immigration enforcement efforts. IRS agents are often armed and possess the authority to make arrests, making them suitable candidates to support the president’s deportation initiatives.
IRS agents also have access to information databases for businesses and individuals through its audit functions, which allows them to enforce the ban on hiring illegal immigrants. A William Mitchell law review highlighted that using IRS agents to address illegal immigration shifts the cost of deportation onto those profiting from bringing illegal immigrants to the U.S. rather than burdening taxpayers. It also noted that the approach could strengthen enforcement by incentivizing informants, encouraging civilians to report violations, and helping enforce the law.
Krause’s resignation will be the latest in a long line of people who have decided to leave their jobs amid Trump’s shakeup of the executive branch. Many have taken the administration’s offer to resign while receiving a payout. There will likely be more to come as Trump ramps up his policies.
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