I ran in to this issue, and noticed it was caused due to an uppercase character in my wp_term_taxonomy.taxonomy column. The plugin I used to create the custom taxonomy did not sanitize the name and an oversight on my part lead to the incorrect case. I had entered “Products” instead of “products”.
On line 490 of taxonomy-image.php the get_taxonomy() function returns false since you passed in the result of sanitize_title_with_dashes().
I have now corrected my bad taxonomy name through the other plugin, and everything works great. I will advise the other plugin author to correct this issue on their end, though that’s only one case which may conflict with your plugin.