The Internal Revenue Service’s proposed tax return inquiry about taxpayers’ citizenship and work authorization isn’t sitting well with a group of Capitol Hill Democrats. Eleven minority members of the Senate Finance Committee want the proposed Form 1040 question dropped. The lawmakers also have questions for the IRS about its yet-to-be-released Tax Gap update.
The Internal Revenue Service is getting ready for the upcoming tax filing season by, among other things, updating tax forms.
A group of U.S. Senators want the tax agency to stop, or at least reverse a proposed change to the 2026 tax year Form 1040.
A recent draft of the document that individual taxpayers use each year to report their income includes a citizenship and work authorization question.
The new inquiry, argue 11 Democratic members of the tax-writing Senate Finance Committee (SFC), is irrelevant to the IRS’ primary role of collecting taxes.
It’s also redundant, they write in a letter to IRS CEO Frank Bisignano, since nonresidents already file Form 1040-NR, and the IRS already checks work authorization against Social Security Administration (SSA) data. (My personal observation: Bisignano has been SSA commissioner since May 2025, so he should know this.)
Lacking any real tax reason for appearing on Form 1040, the question appears to simply be another attempt to involve the IRS in the Trump administration’s immigration policy.
And that, according to the lawmakers, could be costly.
Immigration inquiry revenue consequences: “Turning the 1040 into an immigration tracker actively sabotages voluntary tax compliance and undermines the IRS’s core tax collection responsibilities,” according to Sens. Ben Ray Luján and Ron Wyden, the SFC’s ranking member, who are leading the effort against the form change.
They and their nine cosigning colleagues point out that public trust is already at a low point after the IRS illegally handed over the private data of more than 42,000 taxpayers to Immigration and Customs Enforcement (ICE).
“Putting this question on the front page of the Form 1040 will only discourage people from filing altogether. This is a multi-billion-dollar mistake at a time when our national debt is pushing $40 trillion,” say the Senators.
They also cite Yale Budget Lab estimates that weaponizing tax filing could cost the federal government $313 billion over the next decade, as well as endanger the $66 billion that unauthorized workers currently pay in taxes each year.
Democratic lawmakers want to know
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Questions about the 1040 question: The letter-writing Senators — who also include Catherine Cortez Masto (Nevada), Alex Padilla (California), Peter Welch (Vermont), Martin Heinrich (New Mexico), Chris Van Hollen (Maryland), Jacky Rosen (Nevada), Patty Murray (Washington), Cory Booker (New Jersey), and Elizabeth Warren (Massachusetts) — also asked Bisignano some questions about the proposed Form 1040 inquiry.
The main one, obviously, is whether the IRS will remove the new checkbox. If it does not, they want to know —
- Whether this change was directly or indirectly directed by the White House, and if so, provide a copy of any such communications?
- Whether any change in tax law requires the IRS to add this checkbox?
- Whether the IRS considered the negative impact on voluntary tax compliance and the tax gap before proposing to add this checkbox?
- What is the agency’s estimate of the effect of this change on voluntary tax compliance and the Tax Gap?
Additional queries about uncollected taxes
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Tax Gap targeted, too: The potential effect on the Tax Gap prompted even more written questions for Bisignano.
The SFC Democrats want to know the status of the IRS’ update on the Tax Gap. This is the amount of money that the U.S. Treasury is legally owed, but which the IRS has been, for various reasons, unable to collect.
Under the Biden administration, then IRS Commissioner Danny Werfel released the data annually. The last Tax Gap announcement was in October 2024. That year, the IRS estimated that around $696 billion in owed tax was not collected in 2022, an increase of $200 billion over tax years 2014-2016.
Now, however, the Trump administration appears to be stalling publication of more recent Tax Gap accounting. That report is now almost a year late.
Luján, Wyden and their colleagues want to know when the IRS will publish an updated Tax Gap estimate or projection.
In addition, they asked Bisignano whether that Tax Gap report will cover —
- Tax year 2024, as the IRS promised, or will it focus on 2023?
- Uncollected tax attributable to pass-throughs, corporations, offshore avoidance, and digital assets?
The Senators asked the IRS CEO to answer all the letter’s questions by Oct. 22.
