On Monday (February 17), an alliance composed of labor unions, tax authorities, and small business groups filed a lawsuit to block the Department of Government Efficiency (DOGE) led by Musk from accessing personal taxpayer information from the Internal Revenue Service (IRS).
The lawsuit was filed in a federal court in Washington, D.C. These groups claim that such access violates federal privacy and tax laws.
The lawsuit points out, “DOGE would also be able to access Mr. Musk’s competitors’ tax records held by the IRS. No other business owner on Earth can access this type of information about their competitors, that’s without a doubt.”
The plaintiffs argue that, “While DOGE’s actions with the IRS may seem similar to other agencies it engages with, the controversial system and the laws governing access to these systems are not the same.”
The case was jointly filed by the Center for Taxpayer Rights (CTR), the Main Street Alliance (MSA), the National Federation of Federal Employees (NFFE), and the Communication Workers of America (CWA), and represented by the Democracy Forward Foundation, a left-leaning legal organization that has filed over a dozen lawsuits against him since President Trump took office.
The series of actions by the Department of Government Efficiency have also sparked lawsuits from Democratic state attorneys general, government employee unions, and other private organizations. There have been over a dozen similar lawsuits challenging DOGE’s structure or its review authority over the entire federal government’s classified systems.
Reportedly, the DOGE team is seeking access to a sensitive IRS system called the Integrated Data Retrieval System (IDRS), which the IRS uses to view taxpayer accounts.
This is Musk’s latest move in reforming the federal bureaucratic system with ambitions to cut tens of billions of dollars in spending.
Currently, DOGE is accelerating its understanding of the finances of various government agencies.
This is not the first time DOGE has requested access to government systems. Earlier this month, DOGE employees requested access to the Federal Payment System managed by the Treasury Department, handling trillions in government spending. Addressing concerns about potential data misuse, Musk stated that DOGE would make all activities transparent on its website, “so that all our actions have the maximum transparency.”
Earlier on Monday, a judge denied a request to block DOGE from accessing student loan borrower data from the Department of Education. Last Friday (February 14), another judge rejected a request from unions and other groups trying to block DOGE from accessing data from the Department of Labor, the Department of Health and Human Services, and the Consumer Financial Protection Bureau.
On December 4 last year, President-elect Trump announced his nomination of former Republican Congressman Billy Long of Missouri as IRS Commissioner in his new administration. Trump’s statement implied his intention to dismiss current IRS Commissioner Danny Werfel, whom former President Biden appointed in 2022 for a five-year term. If Trump’s nomination of Long is confirmed by the Senate, Werfel’s term will be shortened significantly.
Previously, on November 26 last year, the Treasury Department stated that due to current laws governing federal spending management, apart from the agreement to reclaim an additional $20 billion in IRS enforcement funds reached by both parties, about $200 billion of the agency’s remaining $224 billion in enforcement funds is currently frozen, creating a gap. Deputy Treasury Secretary Wally Adeyemo urged Congress to swiftly address this issue in the next spending bill, allowing the IRS to access the frozen funds. He also stated that due to the risks of fund shortages and uncertain future funding sources, the IRS may have to halt recruitment.
Recently, sources familiar with IRS plans informed the Associated Press that the IRS is set to lay off thousands of probationary employees midway through the tax season, with layoffs possibly starting as early as this week.