A US federal district judge on Thursday ruled that the Internal Revenue Service (IRS) violated the Internal Revenue Code by inappropriately handing thousands of taxpayers’ confidential information over to Immigration and Customs Enforcement (ICE):

[T]he IRS violated the IRC approximately 42,695 times by disclosing last known taxpayer addresses to ICE through TIN Matching without confirming that ICE’s request set forth the “address of the taxpayer with respect to whom the requested return information relate[d]” … In other words, the IRS not only failed to ensure that ICE’s request for confidential taxpayer address information met the statutory requirements, but this failure led the IRS to disclose confidential taxpayer addresses to ICE in situations where ICE’s request for that information was patently deficient.

Title 26 U.S.C.  § 6103(i)(2)(B)(i) provides that the IRS Secretary shall furnish returns or return information of a taxpayer, but that the request must state “the name and address of the taxpayer whose return or return information is to be disclosed.” Judge Colleen Kollar-Kotelly found that many of ICE’s requests for information were deficient, especially incomplete address information, yet the IRS still granted the requests.

The government has appealed Judge Kollar-Kotelly’s ruling, where the Court of Appeals will work out the discovery issues raised.

This case primarily centers around the plaintiffs’ request for expedited discovery. However, it is a key part of an ongoing legal battle challenging an agreement reached last year between the DHS and the IRS, which would facilitate the sharing of tax information about some immigrants without legal status. In November, the judge stayed this policy of disclosing information to ICE in the absence of enough specificity.

Plaintiffs, various nonprofit organizations and unions, filed the complaint last May, arguing that the Department of Government Efficiency’s (DOGE) efforts to access “sensitive taxpayer data … violates the stringent protections Congress has put in place to restrict the use and disclosure of taxpayers’ information.” The plaintiffs argued that DOGE, in concert with other executive organs such as the Department of Homeland Security (DHS), implemented a mega “application programming interface” to facilitate cross-agency sharing of taxpayer data. The information was to be used in ongoing criminal investigations in connection with ICE.

In a statement made last year, the DHS argued that the sharing of information “is essential to identify who is in our country, including violent criminals, determine what public safety and terror threats may exist so we can neutralize them, scrub these individuals from voter rolls, and identify what public benefits these aliens are using at taxpayer expense.”