The U.S. government has agreed to permanently drop tax claims against President Donald Trump. This is part of a settlement document that is part of a deal to resolve Trump’s $10 billion lawsuit against the Internal Revenue Service over the leak of his tax returns.
According to a one-page document posted to the Justice Department’s website on Tuesday, the U.S. is “forever barred and precluded” from examining or prosecuting Trump, his sons, and the Trump organization’s current tax issues.
The settlement marks an extraordinary use of executive power and goes beyond resolving litigation. It effectively helps shield the president from further examination of his finances and legal conduct.
The move comes after the Trump administration announced Monday the creation of the $1.776 billion “Anti-Weaponization Fund”, which will allow allies of the Republican President who believe they were targeted for prosecution for political purposes, including by the Biden administration Justice Department, to apply for payouts. According to acting Attorney General Todd Blanche, this provides “a lawful process for victims of lawfare and weaponization to be heard and seek redress.” Democrats and government watchdogs derided this as “corrupt” and unconstitutional.
Donald Trump has not only ROBBED YOU of $1.8 billion to reward his allies, but he just used his own government to permanently shield himself, his family, and his businesses from IRS accountability.
The Justice Department quietly released a document this morning that “RELEASES,… pic.twitter.com/2ruw7Yf0EE
— Rep. Mike Levin (@RepMikeLevin) May 19, 2026
Blanche, who was grilled by lawmakers on Capitol Hill on Tuesday, also said he would not rule out the possibility that people who carried out violence during the Jan. 6, 2021, riot at the U.S. Capitol will be considered for payouts from the new fund.
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Open in new tab | The Trump-IRS Settlement | |
|---|---|
| Category | Details |
| The Action | The Justice Department agreed to a settlement that permanently drops existing tax claims against President Donald Trump, his sons, and the Trump Organization. |
| The Catalyst | The agreement resolves Trump’s $10 billion lawsuit against the IRS and Treasury Department regarding the illegal leak of his confidential tax returns by a former contractor. |
| The Terms | The DOJ amended the agreement to dictate that the government is "forever barred and precluded" from auditing or prosecuting the Trump family's past tax returns. Trump will receive a formal apology but no monetary damages. |
| The "Anti-Weaponization Fund" | Tied to the settlement is the controversial creation of a nearly $1.8 billion compensation fund designed for individuals who believe they were unfairly targeted for prosecution for political purposes by the previous administration. |
| The Political Fallout | Democratic lawmakers and government watchdogs have heavily criticized the arrangement—particularly the compensation fund—as a "slush fund" for political allies, while Acting Attorney General Todd Blanche defended it as a necessary process for victims of "lawfare" to seek redress. |
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