Days ago, President Trump suggested that he might fire Internal Revenue Service employees—or send them to the border, telling a crowd at the Circa Resort & Casino in Las Vegas, “They hired, or tried to hire, 88,000 workers to go after you and we’re in the process of developing a plan to either terminate all of them, or maybe we’ll move them to the border.” Leaving aside the fact that the 88,000 figure is a myth, and that the IRS only has about 3,000 people working in the IRS-Criminal Investigation (CI) division, it now seems that at least some IRS workers are likely to be diverted to immigration enforcement.
The Department of Homeland Security has asked Treasury Secretary Scott Bessent to deputize IRS agents to help with efforts to crack down on immigration. A February 7 letter sent out by DHS Secretary Kristi Noem to Bessent suggests that IRS workers could assist DHS with auditing employers charged with hiring illegal immigrants as well as investigating human trafficking. Those skills appear to be directed at CI workers, and Noem repeatedly mentions “law enforcement” personnel. But she doesn’t specify CI and asks for assistance with certain functions that employees outside of the criminal division now perform, such as contract oversight, monitoring civil dockets and conducting “financial audits of businesses suspected of employing illegal immigrants.”
Noem wrote in the letter: “It is DHS’s understanding that the Department of the Treasury has qualified law enforcement personnel available to assist with immigration enforcement, especially in light of recent increases in the Internal Revenue Service’s work force and budget.” That help could include “building complex cases that blend tax, immigration, and money laundering charges.”
Building complex cases is aligned with what CI does—both CI Special Agents (about 2,000 employees who are authorized to carry guns) and CI’s 1,000 support staff, including various analysts, are involved in such case development.
CI is the sixth-largest law enforcement agency in the U.S. It is the criminal investigative arm of the IRS, responsible for investigating financial crimes such as tax fraud, narcotics trafficking, money laundering, public corruption, healthcare fraud, and identity theft. While other federal agencies also have investigative jurisdiction over money laundering and some bank secrecy act violations, the IRS is the only federal agency that can investigate potential criminal violations of the tax code.
But much of what Noem says she wants help with doesn’t reflect what CI employees are trained to do. Those tasks include assisting with “interior immigration enforcement, including detention facility pick-ups of aliens pursuant to the Criminal Program (CAP) and assisting with Institutional Hearing Removal Program (IHRP)” and “managing the non-detained docket, including aliens enrolled in the Alternatives to Detention Program, and monitoring aliens who report to ICE Field Offices for immigration compliance purposes and responding to non-compliance alerts, among other functions.”
Notably, Noem says that she will authorize any law enforcement officials Treasury designates to perform the functions of an immigration officer, including “investigating, determining the location of, and apprehending any alien who is in the United States in violation of Title 8, Chapter 12 or regulations issued thereunder.”
IRS Spending and Hiring
That’s not exactly tax work. And the reference to the additional funding is clearly a tweak at the agency. For the last several years, IRS spending has been a target for Republicans in Congress. That accelerated after the 2022 Inflation Act earmarked almost $80 billion in appropriations for the agency (the House vote for the bill was 220–207, with all Democrats voting in favor and all Republicans voting against it). The extra money was intended to help the IRS pick up 87,000 new workers—including customer service and IT workers—over the next decade. However, the statements were weaponized in the public arena, suggesting that the IRS was arming its entire workforce.
About CI
In fiscal year 2023, the IRS used 82,990 full-time equivalent positions to conduct its work (a decrease of 9.1% since fiscal year 2013). Roughly one-third of the workforce forces on filing and account services (26,878), while others tackle jobs in areas like examinations and collections (31,599) and information services (6,689).
IRS-CI comprises about 4% of that total. Today, IRS-CI personnel is around 3,200, with just under 2,200 sworn officers. Those sworn officers are armed. However, former IRS-CI Chief Jim Lee says they should be, as they are “working some of the most dangerous cases” out there, emphasizing their work tracking criminals.
Those armed agents—CI special agents—are sworn federal law enforcement officers who begin training at the National Criminal Investigation Training Academy (NCITA) in Brunswick, Georgia. Special agents are trained in interviewing, gathering evidence, applying methods of proof, and making recommendations for prosecutions.
Professional staff includes scientists and a digital forensic team that supports special agents in collecting and analyzing digital evidence. In the last fiscal year, CI seized over 1.7 petabytes of digital data in support of investigations (for context, petabyte is 1,000,000 gigabytes (GB), about enough to store 200 million 5 MB photos). The digital forensics team works to recover relevant evidence, including data that may have been encrypted, password protected, or hidden by other electronic means.
Most CI resources are focused on tax crimes. Last year, the agency focused about 70% of its time on tax crimes, including tax refund fraud, identity theft, cybercrimes, scams, and public corruption. CI spent about 11% of its time on narcotics cases as part of the Organized Crime Drug Enforcement Task Force, while the remaining time (17%) was split between general fraud and money laundering cases.
In fiscal year 2023, CI initiated 2,676 investigations and recommended 1,838 cases for prosecution. The resulting incarceration rate was 79%, and the average sentence was 48 months.
According to former CI chiefs and current personnel, this work deters tax crimes and ensures voluntary compliance from taxpayers. A 2024 study showed that for the tax years 2021 and 2022, about 85% of taxes were paid voluntarily and on time. During fiscal year 2023, the IRS collected nearly $4.7 trillion in gross taxes.
Potential Losses
Some in the agency fear that moving agents away from that work would decrease compliance and lower collections. The Institute on Taxation and Economic Policy (ITEP), a non-profit, nonpartisan think tank, shares those concerns. ITEP claims that taking IRS agents off the complex tax collections cases for which they are trained and at which they are skilled would reduce the amount of tax the agency can collect—less enforcement means that more scofflaws would evade detection.
In 2023, then-IRS Commissioner Danny Werfel noted that, with IRA money, CI closed several cases in which wealthy taxpayers were sentenced for tax evasion, money laundering, and filing false tax returns. Specifically, Werfel announced that the IRS had successfully pursued 175 delinquent tax cases for millionaires, generating $38 million in recoveries—a few months later, the agency noted that the compliance effort had generated more than $1 billion in collections.
At the time, Werfel referenced suggestions that an “army of IRS agents” was out to shake down everyday taxpayers. But, he said, “this is unmistakably not the case.” There is, he noted, “no mythical army of IRS agents on the streets—it’s really the opposite,” citing a policy change ending most unannounced visits to taxpayers by agency revenue officers.
Studies from the Congressional Budget Office and Government Accountability Office have found that extra resources for IRS tax enforcement efforts have increased government coffers. ITEP says those resources also help states and local governments since most state and local income taxes piggyback on federal rules and benefit from improved federal compliance. Redirecting tax enforcement resources toward the enforcement of immigration law would, ITEP argues, increase the federal budget deficit and harm state and local budgets.
There’s another reason that ITEP believes that shifting IRS workers to immigration work is a bad idea: Taxpayers are already fearful of the agency, and the move could, ITEP says, make it worse. That mistrust of government, especially the IRS, would be particularly acute in neighbors with undocumented populations. According to an ITEP analysis, for every 10-percentage point drop in tax compliance among the undocumented population, tax revenues would decrease by $9.5 billion annually—with $8.6 billion coming from federal coffers and another $900 million from states and localities.
(And if you don’t believe that immigrants pay taxes, think again. A 2024 analysis from ITEP found that undocumented immigrants paid $96.7 billion in federal, state, and local taxes in 2022. This is consistent with findings from other studies. According to a 2023 analysis by the Cato Institute, when accounting for incomes, taxes paid, and government benefits, immigrants can be a net positive to the economy since, on average, they pay more in taxes than they receive in government benefits at federal, state, and local government levels.)
The IRS declined to comment on the letter, and the Treasury did not respond to a request for comment. But indications are that the agency is bracing for considerably more changes after tax season closes. Tax Day is April 15, 2025.
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