The Right to Privacy and Confidentiality: What the IRS Can and Cannot Disclose

Two related rights govern how the IRS can investigate you and who it can tell what it learns — both are more protective than most taxpayers realize.

Two of the ten rights deal specifically with how your information is handled: the right to privacy, and the right to confidentiality. They're closely related but distinct, and understanding the difference clarifies what the IRS can and cannot do when it comes to both the way it investigates you and who it can tell about what it finds.

The right to privacy: how the IRS can investigate

The right to privacy means you're entitled to expect that any IRS inquiry, examination, or enforcement action will comply with the law and be no more intrusive than necessary, and that it will respect all due process rights, including search and seizure protections and, where applicable, a collection due process hearing. This right is about proportionality and legal process during an active IRS action — not just whether information is shared afterward.

In practice, this means an audit or collection action should be scoped to the actual issue at hand, not used as a pretext for an open-ended fishing expedition into unrelated areas of your finances. It also means certain enforcement actions — particularly liens and levies — come with specific procedural protections, including advance notice and, in many cases, the right to request a Collection Due Process hearing before the action proceeds.

What a Collection Due Process hearing actually is

Before the IRS files certain liens or issues certain levies, you're generally entitled to advance notice and the opportunity to request a CDP hearing, which allows you to raise a range of issues — including whether you actually owe the amount, whether collection alternatives like an installment agreement should be considered instead, and even, in some cases, the underlying liability itself if you didn't previously have a chance to dispute it. This hearing is conducted by the independent Office of Appeals, connecting the right to privacy directly to the same appeals process covered in the right to appeal.

The right to confidentiality: who can be told

The right to confidentiality is a separate guarantee: you're entitled to expect that information you provide to the IRS will not be disclosed unless you authorize it or the law specifically requires it, and to expect appropriate action against IRS employees, return preparers, and others who wrongfully use or disclose your taxpayer information. This is a strong, legally enforceable protection — tax return information is treated as confidential by default, not as a public record or something the IRS can share freely.

The narrow, defined exceptions

Confidentiality is strong but not absolute. There are specific, legally defined circumstances under which tax information can be disclosed without your explicit consent — certain law enforcement investigations under court order, disclosures to other government agencies for specifically authorized purposes (like verifying eligibility for certain benefit programs), and disclosures you yourself authorize, such as when you give a lender or a tax professional permission to access your return information. The key point is that these exceptions are narrow and specific, not a general license for the IRS to share your information whenever convenient.

What this means for working with a tax professional

When you hire a CPA, enrolled agent, or attorney to represent you, they generally need you to sign a specific authorization — commonly IRS Form 2848 (Power of Attorney) or Form 8821 (Tax Information Authorization) — before the IRS will discuss your account with them. This isn't bureaucratic friction for its own sake; it's the confidentiality right working as designed, ensuring your information is only shared with people you've specifically authorized.

What this means for identity theft and unauthorized access

The confidentiality right also underlies the IRS's obligation to take action if your tax information is accessed or disclosed improperly — whether by an IRS employee, a return preparer who mishandled your data, or through identity theft where someone else filed using your information. If you suspect your tax information has been compromised, this right is part of why the IRS has a formal identity theft process (including Form 14039) rather than treating it as solely your problem to resolve.

Where privacy and confidentiality intersect with an audit

During an audit, both rights apply simultaneously. The right to privacy means the examination should stay scoped to the actual tax issue rather than expanding without justification into unrelated areas. The right to confidentiality means whatever information you do provide during that examination stays protected from being shared outside the specific, authorized purposes of the audit itself. If an audit starts to feel like it's ranging well beyond the original issue, or if you're concerned about how your information might be shared, both of these are legitimate, specific rights to raise — not vague discomforts to just tolerate.

A concrete example

Say you're being audited over a specific deduction, and the request for documentation starts to extend into unrelated financial records with no clear connection to the issue under review. Asking directly why that additional information is needed, and how it relates to the stated scope of the audit, is a reasonable exercise of the right to privacy — not an obstruction of the process. Similarly, if you learn that your tax information was discussed with someone you never authorized, that's a legitimate confidentiality concern worth raising formally, potentially with the Taxpayer Advocate Service if normal channels don't resolve it.

The bottom line

The IRS has real, legally bounded authority to investigate and collect, but that authority isn't unlimited or unaccountable. The right to privacy keeps enforcement proportionate to the actual issue and tied to real due process; the right to confidentiality keeps your information from being shared beyond narrow, specific, legally defined exceptions. Both are worth understanding before an audit or dispute reaches a point where you're wondering, after the fact, whether something that happened was actually within bounds.

State tax agencies are a separate question

Everything described here applies specifically to the federal IRS. State tax agencies operate under their own, separate confidentiality and privacy rules, which are often similar in spirit but are legally distinct from the federal Taxpayer Bill of Rights. If a privacy or confidentiality concern involves a state tax agency rather than the IRS specifically, the relevant protections and complaint process will be under that state's own tax code, not the federal rights described on this page.

What to do if you believe your rights here were violated

If you believe your information was disclosed improperly, or that an IRS inquiry was more intrusive than the situation justified, you can raise this directly with the IRS, and in more serious cases, with the Treasury Inspector General for Tax Administration (TIGTA), which investigates misconduct by IRS employees. This isn't a step to take lightly or reflexively, but it exists specifically because the rights to privacy and confidentiality are meant to be enforceable, not just aspirational language.

Third-party contacts during an audit

In some audits, the IRS may need to contact a third party — an employer, a bank, a business associate — to verify information. Generally, you're entitled to advance notice before this happens, giving you the chance to provide the needed information yourself first if you can. This is another practical expression of the privacy right: third-party contact is meant to be a tool used when necessary, not a default first step, and you're entitled to know it's being considered before it happens.

This is general information about United States taxpayer rights, not personalized tax or legal advice — your specific situation may differ, and a licensed tax professional or attorney can advise on your case directly.