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Judge Allows New Bedford Nonprofit’s IRS–ICE Data-Sharing Lawsuit to Proceed

Judge Indira Talwani allowed key claims in a New Bedford-led lawsuit challenging IRS and SSA information sharing with ICE to proceed. The ruling is not a final decision on the legality of the practices.
From TheFinanceBase Team4 min to read

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U.S. District Judge Indira Talwani has allowed key claims in a New Bedford nonprofit’s lawsuit challenging federal data sharing with Immigration and Customs Enforcement (ICE) to proceed. Her September 30, 2026, ruling rejected most of the government’s motions to dismiss, but it is not a final decision on whether the challenged practices are unlawful.

What Judge Talwani’s ruling means

The lawsuit is led by the Community Economic Development Center of Southeastern Massachusetts (CEDC) and joined by three other immigrant-advocacy organizations. The plaintiffs challenge federal agencies’ agreements and practices for sharing information with ICE, including information from the Internal Revenue Service (IRS) and Social Security Administration (SSA). They argue that the disclosures violate taxpayer privacy protections, including 26 U.S.C. § 6103, and the Administrative Procedure Act (APA).

On September 30, Judge Talwani found that CEDC had plausibly alleged organizational standing and allowed key APA claims and a First Amendment Petition Clause claim to continue. At this stage, the court was deciding whether the claims could move forward, not whether the plaintiffs ultimately will win. As the judge put it, “At this stage, the court deems the connection between CEDC’s injuries and the agency action sufficiently plausible to afford CEDC organizational standing,” according to The New Bedford Light’s October 6, 2026 report.

Claims that survived dismissal

The court found plausible the plaintiffs’ allegations that the IRS’s August 2025 disclosure of noncitizen return information violated the APA. It also concluded that the agencies’ adoption and implementation of the data-sharing policy could qualify as final agency action that courts may review. The government argued that remedies under the Internal Revenue Code foreclosed APA review; the court rejected dismissal on that basis where the plaintiffs alleged that prospective injunctive relief was needed.

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The court also let the Petition Clause claim proceed. It did not need to reach the plaintiffs’ additional theories involving associational rights and chilling effects at this stage.

Claim dismissed

Judge Talwani dismissed the plaintiffs’ separate ultra vires claim, which alleged that the agencies had acted beyond their statutory authority. The order reasoned that the challenged conduct could be reviewed through the APA, so a separate nonstatutory ultra vires claim was not available on the allegations presented.

What the IRS address figures do—and do not—show

The New Bedford Light reported that the IRS shared more than 47,000 addresses with ICE in August 2025, after ICE sought addresses for noncitizen taxpayers with final orders of removal. That reported total is distinct from a narrower figure discussed in the court’s order: more than 2,000 taxpayer addresses that the IRS acknowledged sharing despite ICE not providing an address in its request.

The order’s statutory analysis states that an IRS address disclosure violates the Internal Revenue Code when the requesting agency fails to identify an officer “personally and directly engaged” with a specific criminal investigation and proceeding. In response to the government’s position that most sharing complied with the law, the court pointed to a supplemental declaration describing the more-than-2,000-address category. The judge found the plaintiffs’ allegations plausible for purposes of the dismissal motions; she did not make a final merits finding that all, or any specified total, of the disclosures were unlawful.

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The preliminary injunction is separate from the September ruling

A February 5, 2026 preliminary injunction had already blocked ICE from using taxpayer addresses supplied by the IRS under the IRS–ICE memorandum of understanding while the litigation proceeds. The September 30 order said that injunction remained in effect and noted that the government had appealed it to the U.S. Court of Appeals for the First Circuit.

The New Bedford Light reported that oral argument in the appeal was scheduled for October 7, 2026. The available reporting and court materials establish the injunction’s status as of the September 30 order, but do not establish the result of that argument or any later appellate action. The injunction is a temporary measure during the case; it is not the same ruling as the September dismissal decision.

SSA claims and records remain at issue

The case also challenges SSA information sharing with ICE. The September order left the relevant SSA APA claims for later consideration on the administrative record rather than deciding their merits in the dismissal ruling. The New Bedford Light reported that the court ordered production of SSA email records, including unredacted pages under seal.

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A related case is not this lawsuit

On September 8, 2026, the D.C. Circuit affirmed preliminary relief in a separate case, Center for Taxpayer Rights v. IRS. That court held that the IRS Data-Exchange Procedure was reviewable final agency action and likely failed statutory requirements. It provides legal context on the broader IRS–ICE data-sharing dispute, but it involved different plaintiffs and is not the ruling in the New Bedford lawsuit.

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Case timeline

Date Development
April 2025 The IRS–ICE agreement was signed.
August 2025 The IRS shared addresses with ICE, including the more-than-47,000 total reported by The New Bedford Light.
September 2025 The New Bedford-led lawsuit was filed.
February 5, 2026 A preliminary injunction blocked ICE’s use of IRS-provided taxpayer addresses during the litigation.
September 8, 2026 The D.C. Circuit issued a preliminary-relief decision in the separate Center for Taxpayer Rights v. IRS case.
September 30, 2026 Judge Talwani allowed key New Bedford lawsuit claims to proceed, dismissed the separate ultra vires claim, and stated that the injunction remained in effect.
October 7, 2026 First Circuit oral argument on the injunction was reported as scheduled; the result is not established by the available sources.

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