President Donald Trump’s newly announced agreement with the Internal Revenue Service could spare his family from a potential nine-figure tax penalty, according to a recent report.
The Trump administration said this week it had reached a settlement resolving the president’s unprecedented $10 billion lawsuit against the IRS. Filed in January, the suit alleged the agency failed to prevent the leak of his tax returns to the media and sought damages tied to federal investigations into his 2016 campaign’s ties to Russia, as well as the FBI’s 2022 search of Mar-a-Lago.
Under the terms of the deal, the federal government will create a $1.8 billion “anti-weaponization” fund benefiting the president’s allies and will be “forever barred and precluded” from pursuing IRS-related claims against Trump, his family, or his businesses.
The settlement, which applies only to existing audits and not future ones, shields the president from a potentially damaging ruling that could have cost him more than $100 million, according to The New York Times. The outlet was one of several to obtain Trump’s leaked tax return data, which spanned decades, in 2020.
The ruling could have stemmed from the IRS’ audit of Trump, which he has long cited as the reason he did not release his tax returns. It remains unclear where that audit stood recently, though Eric Trump said it was still active in 2024.
The president has consistently said he filed his taxes properly and did nothing wrong. In 2020, he described the audit as a “disgrace.”
The Independent has reached out to the White House for comment.
The audit centered on a nearly $73 million tax refund Trump claimed around 2010. The former real estate developer and “Apprentice” host justified the refund by reporting steep business losses, largely tied to two ventures: his casino holdings and his Chicago skyscraper.
The IRS contended that Trump improperly claimed the same losses twice for the Chicago tower, where he reported losses of up to $651 million.
In addition to sidestepping a potential $100 million penalty, Trump may have also avoided an even larger, “unquantifiable” penalty, given the settlement puts a stop to any other unpublicized audits, according to The New York Times.
The settlement announced this week drew swift criticism from Democrats, who labeled it an example of naked corruption.
“The President is now exempt from our tax laws while everyone else has to obey them. Got it,” Connecticut Sen. Chris Murphy wrote on X. “It’s just mind blowing that is what’s happening in America.”
Some Republicans also raised concerns, particularly over the deal’s $1.8 billion “anti-weaponization” fund. Senate Majority Leader John Thune said he is “not a big fan.”
The administration defended the agreement, arguing it seeks to remedy what it described as years of unfair targeting of conservatives under the Biden administration.
“The machinery of government should never be weaponized against any American, and it is this department’s intention to make right the wrongs that were previously done while ensuring this never happens again,” Acting Attorney General Todd Blanche said Monday during a Congressional hearing.
He also declined to say whether a January 6 rioter found guilty of sex crimes would be eligible for a payout from the $1.8 billion fund.
