Trump drops $10B IRS lawsuit in deal to compensate prosecuted allies
Trump drops $10B lawsuit against IRS
President Trump is moving to dismiss a $10 billion lawsuit against the IRS that he alleges failed to protect confidential tax information of the Trump Organization.
President Donald Trump on Monday withdrew his $10 billion lawsuit against the Internal Revenue Service.
The move was part of a deal that would create a fund for his prosecuted allies.
Trump IRS lawsuit
The backstory:
The president sued earlier this year in federal court in Florida over the leak of his tax information to news outlets between 2018 and 2020.
The lawsuit alleged the leak of his and the Trump Organization’s confidential tax records caused "reputational and financial harm, public embarrassment, unfairly tarnished their business reputations, portrayed them in a false light, and negatively affected President Trump, and the other Plaintiffs’ public standing."
In 2024, former IRS contractor Charles Edward Littlejohn was sentenced to five years in prison after pleading guilty to leaking tax information about Trump and others to two news outlets between 2018 and 2020.
The president’s sons, Donald Trump Jr. and Eric Trump, are also named plaintiffs in the suit.
READ MORE: Trump seeks $1.7 billion fund to pay allies in exchange for dropping IRS lawsuit: reports
Trump IRS tax leak settlement
FILE - US President Donald Trump gestures as he speaks to reporters after arriving on the South Lawn of the White House in Washington, DC, on May 15, 2026. Trump is returning from Beijing where he met with Chinese President Xi Jinping to discuss trad
Meanwhile:
Trump was reportedly prepared to drop his lawsuit as part of a deal that would create a $1.7 billion fund to pay allies of the president who believe they were wrongly investigated and prosecuted by the Biden administration justice department.
The Justice Department announced Monday the "anti-weaponization fund" as part of a deal to resolve Trump’s case over the tax returns leak.
The fund is to "provide a systematic process to hear and redress claims of others who suffered weaponization and lawfare," the department said.
Dig deeper:
The fund will come from the judgment fund, which is a perpetual appropriation allowing DOJ to settle and pay cases, the department said. Five members will be appointed by the attorney general, and the fund will have the power to issue formal apologies and monetary relief owned to claimants
What's next:
It was not immediately clear who precisely will stand to benefit from the reported fund.
The alleged unusual deal has already sparked criticism and ethics concerns.
The Source: Information in this article was taken from a filing in Florida federal court, as obtained and reported by The Associated Press, and from a Justice Department press release. Background information was taken from The Associated Press and previous FOX Television Station reporting. This story was reported from Detroit.