Appeals Court Blocks IRS From Giving ICE Addresses

A federal appeals court on Tuesday blocked the IRS from sharing taxpayer data with Immigration and Customs Enforcement, upholding a lower-court order that halted a program built to answer an ICE request for the last known addresses of 1.28 million people.

The three-judge panel of the U.S. Court of Appeals for the D.C. Circuit found the program violated a tax-privacy law Congress passed in the 1970s after Watergate, when the executive branch was caught using taxpayer files against its enemies.

The ruling leaves the district court's injunction in place while the case continues — it is not a final judgment on the merits.

What the Ruling Blocks

Circuit Judge Cornelia Pillard, writing for the panel, said the privacy law bars the IRS from handing tax records to another federal agency unless strict conditions are met, and that the program failed them.

One condition: the requesting agency must supply the name and address of each taxpayer whose records it wants. According to the ruling, the IRS system checked only whether ICE had typed five or nine digits into the address field. The digits did not have to form a real zip code, and ICE did not have to give a street, a city or a state. The IRS turned over addresses on requests that listed the taxpayer's address as "Unknown Address," "Failed to Provide," or "NA NA."

"A zip code is not an address, and a zip code proxy, as the IRS would define it, might as well be a set of random numbers," U.S. District Judge Colleen Kollar-Kotelly wrote in February, in a passage the appeals court quoted. "For instance, ICE could have submitted a request with an 'address' like, 'Don't Care 12345,' or, '00000,' and still received a taxpayer's address."

"The IRS's operative policy to provide information on those terms flies in the face of the statutory command," Pillard wrote.

The Numbers

The IRS handed over 47,289 taxpayer records in August 2025, and more than 90% came through a matching process that never checked the address ICE supplied, according to the ruling. Kollar-Kotelly found in February that the agency had broken the privacy law roughly 42,695 times.

The law also limits disclosure to agency employees "personally and directly engaged" in a criminal investigation of that specific taxpayer. The ruling said the IRS program required only that ICE fill in a point-of-contact field, which would accept an entry like "Unknown" or "TBD" — and that ICE listed the same person as the point of contact on all 1.28 million requests. Earlier that month, ICE had also asked the IRS for records on more than 7 million people it said had entered the country illegally.

The district court called it "facially implausible" that one person could be personally and directly engaged in roughly 47,000 criminal matters, let alone 1.28 million.