This is the story of how Trump’s allies — along with Elon Musk’s shadowy Department of Government Efficiency, known as DOGE — stormed the IRS, stripped away decades of privacy protections, and forced the agency to hand over taxpayer data to immigration enforcement.
“It felt like a hostile takeover,” said one former IRS employee. “If we would have imagined some foreign government sending in adversaries to take us over, this is what it would have felt like.”
The Order: Get the Data
The Trump White House had a plan: use IRS data to track down and deport undocumented immigrants. The goal? Names, addresses, and financial information on hundreds of thousands of people — possibly millions.
The problem? It was illegal.
The IRS’s own lawyers and privacy officials said so.
“There is no clear legal authority right now for this,” the agency’s chief privacy officer told top leadership, according to a source familiar with the meeting. Another senior official said bluntly: “This doesn’t sound quite kosher to me.”
Then-acting Commissioner Doug O’Donnell slammed the brakes: “Absolutely not, that’s not what we do here,” he told staff.
But that didn’t stop them.
DOGE Moves In
In February, DOGE staff — operating directly under Musk and Trump loyalists — showed up at IRS headquarters with no warning. Within days, they started pressuring officials to give Immigration and Customs Enforcement (ICE) access to data on more than 700,000 people.
O’Donnell resisted. So did Chief Privacy Officer Kathleen Walters and the agency’s lawyers. They thought the matter was settled.
It wasn’t. O’Donnell retired — suddenly — and DOGE pounced. Just one hour into his replacement’s tenure, the request was back on the table.
Melanie Krause, the new acting commissioner, was a federal veteran but new to the IRS. She didn’t shut it down. In fact, sources say she seemed open to “seeing what could be done.”
What followed was a blitz: DOGE operatives worked around normal procedures, cut out privacy experts, and started replacing senior officials who asked too many questions.
Silenced, Demoted, Replaced
By mid-March, the Trump team demoted the IRS’s acting general counsel, Bill Paul, and replaced him with Andrew De Mello — a known Trump ally from the first administration.
“This was a big moment,” said one insider. “Bill was raising questions about the data-sharing agreement. They replaced him with someone who would say yes.”
Then Walters, the privacy chief, was iced out. She kept raising red flags. So they simply stopped inviting her to meetings.
“Kathleen was removed from the room of decision-making,” one source said. Her emails raising concerns were ignored. When she asked to see a draft of the data-sharing deal, they gave it to her “cold” — minutes before a meeting with DHS officials.
She refused to sign. Others refused too.
So De Mello went higher. Eventually, Treasury Secretary Scott Bessent signed the deal. DHS Secretary Kristi Noem signed for ICE.
‘Don’t Let the Door Hit You’
The deal was finalized quietly, late on April 7. It was revealed in a court filing just before midnight. An hour later, Fox News had the “exclusive.” Krause found out about it in the media. She resigned the next day.
When asked about the mass resignations, White House spokesman Harrison Fields said: “Those that are not willing to support the president’s agenda and common-sense reform to government, don’t let the door hit you on the way out.”
And what about the billions in tax dollars undocumented immigrants pay every year? Fields didn’t flinch.
“You cannot compare the loss of tax revenue to the yearly cost endured by keeping them here.”
‘A Bloodbath’ at the IRS
The fallout inside the IRS was swift. The CFO. The CIO. The Chief Risk Officer. The Chief of Staff. The Privacy Officer. All gone.
One was placed on leave after clashing with DOGE. Others quit in protest. Some were pushed out.
“It’s pretty much a bloodbath,” said one former senior IRS official.
“These are all great people, passionate civil servants who were asking the right questions.”
As of now, the IRS is bracing for up to 20% staff cuts — possibly more. Morale is cratering.
One senior IRS official compared it to preparing for the Super Bowl:
“It’s like going into your final practice before the big game and telling the players they’ll get texts mid-practice saying whether they’re fired or not.”
Legal Battle Looms
Immigrant rights groups are suing. A court hearing is set for Wednesday in D.C. federal court. They argue the IRS violated federal law — laws that require a court order before handing over taxpayer data for deportations.
Former IRS Commissioner Danny Werfel said plainly: “There is no explicit language allowing this exception.”
The Biden-era Treasury veteran Natasha Sarin warned the damage will go far beyond immigration.
“Losses could be more – and not just with the undocumented population – as this action… makes people more nervous about sharing data with the IRS,” she tweeted.
Fear Spreads
Across the country, undocumented immigrants are panicking.
“Our clients are freaking out,” said immigration lawyer Neil Weinrib. “I’ve never seen anything like this.”
He shared one message from an Indian national “What is this news with the IRS? If my wife gets caught with my son, what should she do?”
Advocates say this will only drive people underground. The Yale Budget Lab estimates the government could lose $300 billion in tax revenue over the next decade because of the fear this policy is causing.
And it’s not just immigrants. It’s everyone who pays taxes. Everyone who believed the IRS was above politics. Everyone who thought their data was safe.
Now, the IRS — the agency that funds the federal government — is being turned into a tool for mass deportation.
And those who stood in the way? They were told to get out of the way — or be removed.
They said no. DOGE didn’t care. They took the IRS by force.
