Center For Taxpayer Rights V Internal Revenue Service

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Key Facts

On November 21, 2025, the United States District Court for the District of Columbia issued an order in CENTER FOR TAXPAYER RIGHTS v. INTERNAL REVENUE SERVICE (Civil Action No. 25-0457). The Court held that the IRS's August 7, 2025 disclosure of confidential taxpayer address information to Immigration and Customs Enforcement (ICE) under the "Address-Sharing Policy" violated the Administrative Procedure Act and Internal Revenue Code Section 6103(i)(2). The Court granted the Plaintiffs' Motion for Stay and preliminarily enjoined the IRS, Department of the Treasury, and Acting Commissioner Scott Bessent from disclosing return information to DHS or ICE except in strict compliance with statutory requirements. Count One of the Plaintiffs' Amended Complaint was dismissed without prejudice, while Count Two was denied. The IRS must notify ICE by November 24, 2025, and ICE must restrict access to and return the disclosed information.

Tax Type

Taxpayer return information disclosure

Issues

  • The court granted the Plaintiffs' Motion for Stay, enjoining the IRS from disclosing taxpayer return information to DHS or its component agencies without strict compliance with Section 6103(i)(2) requirements, including that recipients be officers and employees personally and directly engaged in relevant nontax criminal investigations.
  • The court granted the Defendants' Motion to Dismiss as to Count One of the Plaintiffs' Amended Complaint for failure to state a claim, but denied the Motion as to Count Two, where Plaintiffs assert claims under the Administrative Procedure Act and allege violations of the Internal Revenue Code and the Privacy Act.
  • The court addressed the lawfulness of the IRS's Address-Sharing Policy, which authorized the disclosure of confidential taxpayer address information to Immigration and Customs Enforcement under Section 6103(i)(2) of the Internal Revenue Code. The Court held that the August 7, 2025 disclosure was unlawful.

Holdings

The Court GRANTS IN PART and DENIES IN PART Defendants' Motion to Dismiss and GRANTS the Motion for Stay under 5 U.S.C. § 705 or, in the Alternative, for a Preliminary Injunction. The Court held that Defendant IRS's August 7, 2025, disclosure of confidential taxpayer address information to ICE was unlawful under the Administrative Procedure Act and Internal Revenue Code Section 6103(i)(2). Count One of Plaintiffs' Amended Complaint is DISMISSED WITHOUT PREJUDICE for failure to state a claim, while Count Two is DENIED. The Address-Sharing Policy is STAYED pending further review, and Defendants IRS, Department of Treasury, and Scott Bessent are PRELIMINARILY ENJOINED from disclosing return information to DHS or ICE except in strict compliance with Section 6103(i)(2).

Remedies

  • The Court STAYED the new Internal Revenue Service policy to disclose confidential address information of tens of thousands of taxpayers to Immigration and Customs Enforcement under Section 6103(i)(2) of the Internal Revenue Code, pending further review under 5 U.S.C. § 705.
  • Defendants IRS, Department of the Treasury, and Scott Bessent are PRELIMINARILY ENJOINED from disclosing any return information, including taxpayer return information, to the Department of Homeland Security or any of its component agencies pursuant to Section 6103(i)(2), except in strict compliance with the requirements of that Section.
  • The Court ORDERED that Defendant IRS shall file a notice with the Court within 48 hours of receiving any future request from DHS for return information pursuant to Section 6103(i)(2). Additionally, Defendant IRS must notify ICE on or before November 24, 2025 that the August 7, 2025 disclosure of confidential taxpayer address information to ICE was unlawful, and Defendant Bessent must notify Secretary Noem and Mr. Lyons of the Court's order.
  • The Court GRANTED IN PART and DENIED IN PART Defendants' Motion to Dismiss, granting as to Count One of Plaintiffs' Amended Complaint (which is DISMISSED WITHOUT PREJUDICE for failure to state a claim) and denying as to Count Two (which asserts claims under the Administrative Procedure Act and alleges violations of the Internal Revenue Code and the Privacy Act).

Tax Issue Category

Other

Legal Principles

The court applied the Administrative Procedure Act and Internal Revenue Code Section 6103(i)(2) to hold that the IRS's August 7, 2025 disclosure of confidential taxpayer address information to ICE was unlawful. The court granted a stay pending further review under 5 U.S.C. § 705 and issued a preliminary injunction requiring compliance with statutory requirements for information disclosure and use.

Cited Statute

  • Internal Revenue Code Section 6103(p)(4)
  • Internal Revenue Code Section 6103(i)(2)
  • Internal Revenue Code Section 6103(b)(3)
  • Administrative Procedure Act
  • Internal Revenue Code Section 6103(b)(2)

Judge Name

Judge Colleen Kollar-Kotelly

Passage Text

  • It is further ORDERED that the new policy of the Internal Revenue Service ('IRS') to disclose the confidential address information of tens of thousands of taxpayers to Immigration and Customs Enforcement ('ICE') under Section 6103(i)(2) of the Internal Revenue Code, in reliance on representations from ICE that the addresses are relevant to and will be used for immigration-related criminal investigations and proceedings, even when ICE identifies only a single ICE employee (or a small number of ICE employees) as the employee(s) 'personally and directly engaged' in each of the tens of thousands of relevant criminal investigations or proceedings (the 'Address-Sharing Policy'), is STAYED pending further review. See 5 U.S.C. § 705.
  • It is further ORDERED that Defendants IRS; Department of the Treasury; and Scott Bessent, in both his official capacity as Secretary of the Treasury and his official capacity as Acting Commissioner of the IRS, are PRELIMINARILY ENJOINED from disclosing any return information, including taxpayer return information, to the Department of Homeland Security ('DHS') or any of its component agencies pursuant to Section 6103(i)(2), except in strict compliance with the requirements of that Section, including that the recipients of the information be 'officers and employees of [the receiving] agency who are personally and directly engaged' in a relevant nontax criminal investigation or proceeding and that the recipients will use the information 'solely for' that criminal investigation or proceeding. See 26 U.S.C. § 6103(i)(2).
  • For the reasons stated in the accompanying Memorandum Opinion, the Court GRANTS IN PART and DENIES IN PART Defendants' Motion to Dismiss and GRANTS the Motion for Stay under 5 U.S.C. § 705 or, in the Alternative, for a Preliminary Injunction, filed by Plaintiffs Center for Taxpayer Rights; Main Street Alliance; National Federation of Federal Employees, IAM AFL-CIO; and Communications Workers of America, AFL-CIO. The Court has held that Defendant IRS's August 7, 2025, disclosure of confidential taxpayer address information to ICE, pursuant to a new policy (the 'Address-Sharing Policy'), was unlawful under the Administrative Procedure Act and Internal Revenue Code Section 6103(i)(2).