Trump Settles His Own Lawsuit Against His Own IRS by Creating a $1.776 Billion Slush Fund for Political Allies and Blanket Immunity for Himself and His Family

Earlier this year, Donald Trump sued the IRS and Treasury Department over the actions of a former IRS contractor, who illegally disclosed Trump’s tax returns that, unlike previous presidents, he refused to release voluntarily. Despite serious weaknesses in the case—including the fact that it was filed after the statute of limitations, and similarly situated plaintiffs received only a formal apology, not money—the Justice Department settled with Trump on behalf of the government by creating a $1.776 billion “Anti-Weaponization Fund” that could be used to compensate Jan. 6 defendants prosecuted under the Biden administration. It purports to grant Trump and his family broad immunity from a wide range of government actions against them.

As if that were not bad enough, the fund will have no independent oversight and no disclosure requirements.

Lawfare reports:

The fund—drawn entirely from the federal Judgment Fund, a permanent congressional appropriation used to pay court settlements against the United States—will be used to dispense taxpayer money to people who suffered from purported Democratic “weaponization” and “lawfare.” While Trump is not expected to receive compensation from the fund himself, money will be doled out by a five-member board he effectively controls, operating under procedures that need not be disclosed, with the identities of recipients potentially kept secret. …

By waiving any matter that “could be pending” before any agency or department, the agreement purports to give the Trump family blanket immunity from the government for everything they have done. The parenthetical “(including tax returns filed before the Effective Date)” is at once logically unnecessary, possibly illegal, and clarifying. According to a 2024 New York Times report, an ongoing IRS audit might cost Trump over $100 million. It stands to reason that this is what the language was designed to address.

This self-dealing scheme exploited loopholes in the legal system in such a manner that it’ll be hard to use the law to stop it, although some police officers who were injured on Jan. 6 have sued.

Judge Kathleen Williams, who was handling Trump’s lawsuit, was seeking external advice on whether Trump could sue his own government. She was scheduled to be briefed on May 20, but the Justice Department hastily settled with Trump two days prior. Since the settlement is outside her jurisdiction, she cannot rule on the legality of the slush fund. Even by this administration’s standards, this is brazen. Check out Walter Olson’s piece for The UnPopulist on the new low that this administration has set.

The Executive Watch is a project of the Institute for the Study of Modern Authoritarianism, and its flagship publication The UnPopulist, to track in an ongoing way the abuses of the power of the American presidency. It sorts these abuses into five categories: Personal Grift, Political Corruption, Presidential Retribution, Power Consolidation, and Policy Illegality. Click the category of interest to get an overview of all the abuses under it.

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