The presence of Elon Musk’s cost-cutting task force, the Department of Government Efficiency, at the IRS is sparking fresh concerns from Democratic lawmakers about the safety of taxpayer information, and whether the group’s work could cause delays in taxpayers receiving their refunds.
In a Feb. 17 letter to the IRS, Senators Ron Wyden and Elizabeth Warren, both Democrats, cited reports that DOGE is “pressuring the IRS to agree to a memorandum of understanding (“the MOU”) which would give software engineers working for Elon Musk at DOGE broad access to IRS systems, property and datasets which include the private tax return information of hundreds of millions of American citizens and businesses.”
DOGE is reportedly requesting access to the IRS’ Integrated Data Retrieval System, or IDRS, which would provide the group with access to tax data for individuals and businesses, according to the Washington Post. DOGE is currently at the IRS, a White House official confirmed to CBS News. The IRS didn’t immediately return a request for comment.
Supporters of DOGE view its efforts as a way to cut what they see as bloated federal spending at a time when the nation’s outlays are outstripping its tax revenue, pushing the federal debt to an all-time high of $36 trillion. But the group’s efforts have also sparked several lawsuits, with consumer advocates and Democratic lawmakers raising alarms earlier this month after DOGE gained access to the Treasury Department’s payment system, which stores personal data for most Americans.
IRS data is particularly sensitive, given that it reflects financial details for millions of Americans and businesses, ranging from their income, employers, losses, investments, dependents and other items. Under the IRS taxpayers’ bill of rights, “information [taxpayers] provide to the IRS will not be disclosed unless authorized by the taxpayer or by law.”
“Software engineers working for Musk seeking to gain access to tax return information have no right to hoover up taxpayer data and send that data back to any other part of the federal government and may be breaking the law if they are doing so,” Wyden and Warren wrote in the Feb. 17 letter.
The senators pointed to privacy regulations in the tax code that they said provide “strong legal protections” for taxpayer data, noting that violation of those laws can result in incarceration or other criminal penalties. They added that even if the DOGE employees are employed at the Treasury Department, which oversees the IRS, they may still be violating the law by accessing taxpayer data.
“There are serious statutory and regulatory restrictions on when employees outside the Treasury Department may gain access to tax return information,” the letter said.
It added, “To date, no information on DOGE employees or any others executing orders on Musk’s behalf have revealed any clear, stated purpose as to why they need access to return information, whether they have followed all required laws to gain access to IRS systems, and what steps the IRS has taken to ensure that inspection of tax return is contained to authorized personnel and not disclosed to any unauthorized parties.”
Protections for taxpayer data were increased in the 1970s after former President Nixon sought to use the IRS against his political opponents, according to New York University’s Tax Law blog.
“Congress acted to put in place ironclad guarantees against such abuses and a bipartisan consensus emerged to ensure the privacy of every American’s tax information,” Robert Weissman, the co-president of consumer advocacy group Public Citizen, told CBS MoneyWatch. “Musk and DOGE’s attempt to gain access to IRS data raises profound questions about whether those protections are now being shredded.”
In an interview with Fox News, Stephen Miller, White House deputy chief of staff, said DOGE was seeking to find signs of tax fraud.
“We are talking about performing a basic anti-fraud review to ensure that people are not engaging in large scale theft of federal taxpayer benefits,” he said. “I mean, for example, we pay billions of dollars a year in child tax credit payments to illegal aliens, billions with a B. So these are systematic, programmatic reforms that we’re talking about here.”
Delays to IRS tax refunds?
Wyden and Warren also raised concerns about DOGE’s impact on tax refunds this year.
DOGE’s work at the IRS comes as the tax agency is in the middle of the current tax season, when about 140 million individual tax returns are expected to be filed before the April 15 deadline. For many households, their tax refund check — which last year averaged more than $3,100 — is often their biggest cash influx of the year.
“We are also extremely concerned that DOGE personnel meddling with IRS systems in the middle of tax filing season could, inadvertently or otherwise, cause breakdowns that may delay the issuance of tax refunds indefinitely,” the Feb. 17 letter said. “Any delay in refunds could be financially devastating to millions of Americans who plan their budgets around timely refunds every spring.”
In the meantime, the IRS is preparing to fire thousands of probationary workers in the middle of tax season, the Associated Press reported, citing two sources familiar with the agency’s plans. It’s unclear how many IRS workers could be impacted, however, the AP noted. Federal workers in a probationary period typically have less than one year on the job and have not yet gained civil service protection.
The cuts would come even as IRS employees were told they would not be able to participate in the Trump administration’s earlier “deferred resignation” offer until after the tax filing deadline had passed.
A letter sent earlier this month to IRS workers said that “critical filing season positions in Taxpayer Services, Information Technology and the Taxpayer Advocate Service are exempt” from the administration’s buyout plan until May 15.
Taxpayers have until April 15 to file their taxes unless they are granted an extension.
—With reporting by Aaron Navarro.
contributed to this report.
