WASHINGTON (AP) — A federal judge said Thursday that the IRS broke the law by disclosing confidential taxpayer information “approximately 42,695 times" to Immigration and Customs Enforcement.
U.S. District Judge Colleen Kollar-Kotelly found that the IRS had erroneously shared the taxpayer information of thousands of people with the Department of Homeland Security as part of the agencies’ controversial agreement to share information on immigrants for the purpose of identifying and deporting people illegally in the U.S.
Her finding was based off a declaration filed earlier this month by Dottie Romo, IRS’ chief risk and control officer, which revealed that the IRS had provided DHS with information on 47,000 of the 1.28 million people that ICE requested — and, in most of those cases, gave ICE additional address information in violation of privacy rules created to protect taxpayer data.
Kollar-Kotelly said in her Thursday decision that the agency violated IRS Code 6103, one of the strictest confidentiality laws in federal statute, “approximately 42,695 times by disclosing last known taxpayer addresses to ICE.” She called the Romo declaration “a significant development in this case.”
“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," she wrote.
The government is appealing the case, but the Thursday ruling is significant because Romo's declaration supports the decision on appeal.
Nina Olson, founder of the Center for Taxpayer Rights, which has sued the government over the disclosure, says “this confirms what we’ve been saying all along: that the IRS has an unlawful policy that violates the Internal Revenue Code’s protections by releasing these addresses in a way that violates the law’s requirements.”
Representatives from the IRS and Treasury Department did not respond to Associated Press requests for comment.
A data-sharing agreement signed last April by Treasury Secretary Scott Bessent and Homeland Security Secretary Kristi Noem allows ICE to submit names and addresses of immigrants inside the U.S. illegally to the IRS for cross-verification against tax records. The deal led the then-acting commissioner of the IRS to resign.
There are several ongoing cases that challenge the IRS-DHS agreement.
Earlier this week, a three-judge panel for the U.S. Court of Appeals for the D.C. Circuit declined to issue a preliminary injunction for the immigrants’ rights group, Centro de Trabajadores Unidos, and other nonprofits that are suing the federal government to stop implementation of the agreement.
In declining the preliminary injunction request, Judge Harry T. Edwards wrote that the nonprofit groups “are unlikely to succeed on the merits of their claim,” since the information the agencies are sharing isn’t covered by the IRS privacy statute.
Still, two separate court orders have blocked the agencies from massive transfers of taxpayer information and blocked ICE from acting upon any IRS data in its possession. Those preliminary injunctions are still in place.
FILE - The Internal Revenue Service 1040 tax form for 2022 is seen on April 17, 2023. (AP Photo/Jon Elswick, File)
NEW YORK (AP) — The worst day for Nvidia's stock since last spring is dragging the U.S. market lower on Thursday, even though most stocks are rising.
The S&P 500 slipped 0.5% following swivels earlier in the week driven by hopes and worries created by the artificial-intelligence revolution. The Dow Jones Industrial Average was up 62 points, or 0.1%, with a little less than an hour remaining in trading, and the Nasdaq composite was 1.2% lower.
Nvidia, whose chips are helping to power the AI boom, reported another stellar quarter of profit growth that breezed past analysts’ expectations. It also gave a forecast for revenue in the current quarter that once again topped Wall Street’s estimates.
But such blowout performances have become so typical for Nvidia that they're losing their oomph. Its stock sank 5.3% and was heading toward its worst loss since April.
“Our customers are racing to invest in AI compute — the factories powering the AI industrial revolution and their future growth,” Nvidia CEO Jensen Huang said.
Worries are nevertheless rising that those customers may eventually curtail their spending on Nvidia's chips and other AI investments amid doubts about whether they can make back all their billions of dollars through future gains in productivity.
Because Nvidia’s is the largest stock in the U.S. market by value, it has more influence on the S&P 500 than any other. It alone accounted for more than three-quarters of the S&P 500's loss.
Despite Nvidia's troubles, seven stocks rose in the S&P 500 for every three that fell. Among them was Salesforce, which climbed 4.2% after it likewise reported a stronger profit for the latest quarter than analysts expected.
It’s a return to gains for the stock, which is still down nearly 25% for the young year so far. It’s been under pressure because of worries that AI-powered competitors could undercut its business.
Salesforce uses AI itself in its offerings that help customers manage relationships with their own customers. It also made several announcements that typically give a stock’s price a boost: It will send up to $50 billion to shareholders through buybacks of its stock, and it increased its dividend.
“Agentic AI is a tailwind for our business,” CEO Marc Benioff said.
Stocks of companies in industries as far flung as trucking logistics and financial services have likewise come under sudden and aggressive attacks this year by investors who fear their businesses may lose out to AI or even become obsolete.
The sharpest swings have hit software companies, and a widely followed ETF that tracks the industry rose 2% Thursday to trim its loss for the year so far to 22%.
Elsewhere on Wall Street, Warner Bros. Discovery shares edged down 0.1% after the entertainment giant reported a $252 million loss for the fourth quarter. That didn’t seem to bother investors, who are likely more interested in which acquisition offer — Netflix or Paramount Skydance — the company and its shareholders ultimately accept.
Some of the sharpest swings in financial markets were for oil, where prices swiveled as the United States and Iran held indirect talks about Iran’s nuclear program.
A peaceful solution would remove the threat of war, which investors worry could block the global flow of oil and drive up its price. The U.S. military has already built up the largest force of American warships and aircraft in the Middle East in decades, which has raised the stakes. The current round of talks feels “make or break,” according to strategists at Macquarie.
A barrel of benchmark U.S. crude briefly fell as low as $63.60. But it erased that loss and rose above $66.50 before settling at $65.21, up 0.3%. Brent crude, the international standard, also had a zigzag day and finished at $70.75 per barrel, down 0.1%.
In stock markets abroad, indexes rose modestly in Europe following a mixed finish in Asia.
South Korea’s Kospi leaped 3.7% to another record, driven by gains for tech-related stocks. It’s already surged nearly 50% since the turn of the year.
Hong Kong’s Hang Seng, meanwhile, lost 1.4%.
In the bond market, Treasury yields eased. The yield on the 10-year Treasury fell to 4.01% from 4.05% late Wednesday.
A report showed that the number of U.S. workers applying for unemployment benefits ticked up last week, but not by any more than economists expected. It also remains relatively low compared with history.
AP Business Writers Chan Ho-him and Matt Ott contributed.
Options traders Chris Dattolo, left, and Steven Rodriguez work on the floor of the New York Stock Exchange, Friday, Feb. 20, 2026. (AP Photo/Richard Drew)
Snow falls outside the New York Stock Exchange, Monday, Feb. 23, 2026, in New York. (AP Photo/Seth Wenig)
A screen shows the Korea Composite Stock Price Index (KOSPI) of over 6,000 points during a ceremony at the Korea Exchange in Seoul, South Korea, Wednesday, Feb. 25, 2026. (AP Photo/Lee Jin-man)
Chairman of the Financial Services Commission, Lee Eog-weon, second from left, Chairman & CEO of the Korea Exchange, Jeong Eun Bo, center, a and other officials celebrate as a screen shows the Korea Composite Stock Price Index (KOSPI) of over 6,000 points during a ceremony at the Korea Exchange in Seoul, South Korea, Wednesday, Feb. 25, 2026. (AP Photo/Lee Jin-man)
People walk near an electronic stock board showing Japan's Nikkei index at a securities firm Thursday, Feb. 26, 2026, in Tokyo. (AP Photo/Eugene Hoshiko)
A person stands in front of an electronic stock board showing Japan's Nikkei index at a securities firm Thursday, Feb. 26, 2026, in Tokyo. (AP Photo/Eugene Hoshiko)
A person stands as a vehicle passes by in front of an electronic stock board showing Japan's Nikkei index at a securities firm Thursday, Feb. 26, 2026, in Tokyo. (AP Photo/Eugene Hoshiko)
