A senior Internal Revenue Service leader has taken the agency to federal court, accusing her own colleagues of leaking confidential information to the media in an effort to destroy her career. The explosive lawsuit, filed Thursday in Washington, D.C., federal court, pits IRS Commissioner of the Large Business and International Division Holly Paz against the very institution she has served for nearly two decades.
Paz claims the IRS and the U.S. Treasury Department engaged in a “vindictive, retaliatory undertaking” by funneling information from her protected records to news outlets, including Fox News and Bloomberg.
“This behavior is the epitome of unprofessionalism,” Paz declared in her complaint, saying her Privacy Act–protected employment details were deliberately handed to journalists without her consent.
Dispute Over Employment Status
The conflict stems from July 29, when Paz was abruptly placed on administrative leave without explanation. On Sept. 2, the IRS issued a notice proposing to terminate her federal service, citing her role in the agency’s controversial scrutiny of conservative groups seeking tax-exempt status more than a decade ago.
But only days later, on Sept. 9, Fox News reported she had already been fired—an assertion Paz insists was false. The outlet later edited its story after being told she remained on leave. Bloomberg also published reports about her status within an hour of her being notified by the agency, she said, again citing unnamed sources.
