IRS Workers Snooped Through Private Tax Records, and 22 Were Not Fired, Watchdog Finds

Dozens of Internal Revenue Service employees were flagged for suspicious access to the tax records of 30 taxpayers, including US government officials, business leaders, and entertainers, according to a Treasury watchdog report.

The Treasury Inspector General for Tax Administration identified 86 suspicious accesses involving 52 IRS employees between 2022 and 2025. The findings also revealed that the IRS failed to notify 276 taxpayers across two groups after their records were accessed without authorisation.

TIGTA found weaknesses in the IRS programme designed to prevent and address unauthorised access to taxpayer accounts, including gaps in preventative controls, employee discipline, and taxpayer notification procedures. The findings do not establish that the 86 suspicious accesses resulted in the disclosure or misuse of taxpayer information. They concern access to taxpayer records that employees were not authorised to view.

IRS Failed to Notify Hundreds of Taxpayers

TIGTA found that the IRS failed to notify 175 taxpayers that their records had been accessed by an unauthorised IRS employee because established procedures were not followed. A further 101 taxpayers were not notified because the employees involved had resigned or retired before disciplinary action was proposed. TIGTA therefore identified notification failures involving 276 taxpayers across the two groups.

The watchdog also found weaknesses in the timeliness of notifications following suspected unauthorised access. IRS policy requires employees and contractors to protect taxpayer information. Current IRS guidance on unauthorised access, known as UNAX, states that removal of an employee is to be proposed for UNAX violations, although the penalty can be mitigated by the deciding official.

22 Employees Were Not Terminated

TIGTA identified 22 employees who were not terminated despite accessing taxpayer records without authorisation. The finding formed part of the watchdog's assessment of whether the IRS disciplinary process was consistently holding employees accountable for unauthorised access.

The watchdog said the broader UNAX programme was not adequately addressing the risk of employees accessing taxpayer accounts without authorisation. Its recommendations therefore focused on strengthening preventative controls, improving disciplinary processes, and ensuring taxpayers are notified when unauthorised access is identified.

TIGTA Calls for Stronger Controls

TIGTA issued eight recommendations following its review. They included studying system improvements to reduce UNAX cases, limiting the number of employees with access to certain command codes, and issuing guidance that emphasises the legal consequences of intentional unauthorised access. Acting IRS Chief Privacy Officer John Walker responded to the watchdog's draft report.

The IRS agreed or partially agreed with seven recommendations and said corrective measures were planned for December 2026. The agency disagreed with a recommendation to establish overall timeliness standards for notifying affected taxpayers, saying such standards already existed.

Previous Tax Record Disclosure Cases

The findings come amid continued scrutiny of how the IRS protects confidential taxpayer information. Former IRS contractor Charles Littlejohn was sentenced to five years in prison in January 2024 after admitting to unlawfully disclosing confidential tax return information, including information relating to Donald Trump and other wealthy Americans.

IRS materials have cited the Littlejohn case as an example of the risks associated with unauthorised access and disclosure of taxpayer information. Trump filed a $10 billion lawsuit against the IRS and the Department of the Treasury in January 2026, alleging that the government had failed to protect confidential tax records from unauthorised inspection and disclosure.

He voluntarily dropped the lawsuit in May 2026. The Littlejohn case and Trump's lawsuit are separate from the latest TIGTA review, which examined suspicious access by IRS employees between 2022 and 2025. The latest report puts the focus on whether the IRS can strengthen controls over taxpayer records, apply disciplinary procedures consistently, and notify taxpayers when unauthorised access is identified.