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Trump settles his own $10B suit against the IRS with a $1.776B taxpayer fund and a bar on IRS claims
On May 18, 2026, acting Attorney General Todd Blanche announced a settlement of Trump’s $10 billion suit against the IRS. It created a $1.776 billion fund and barred IRS tax claims against the plaintiffs. A judge found the suit collusive, and the fund was rescinded on August 2, 2026.
What happened
In January 2026, Trump, Donald Trump Jr., Eric Trump and the Trump Organization filed a $10 billion lawsuit against the IRS and Treasury over the 2019-20 leak of Trump’s tax returns. On May 18, 2026, acting Attorney General Todd Blanche announced a settlement of the suit.
The plaintiffs received an apology and no damages. The agreement directed the attorney general to create a $1.776 billion “Anti-Weaponization Fund,” drawn from the Judgment Fund, to pay people claiming harm from “weaponization and lawfare.” It also barred the IRS from pursuing tax claims against the plaintiffs.
On July 13, 2026, Judge Kathleen Williams found the suit collusive and sanctioned Trump’s lawyers. Blanche rescinded the fund on August 2, 2026. The $1.776 billion was to come from the Judgment Fund, and no payment from the fund has been reported.
Who benefited
Trump, Donald Trump Jr., Eric Trump and the Trump Organization were barred from further IRS tax claims under the agreement. They received an apology and no damages. The people the fund was meant to pay were those claiming harm from “weaponization and lawfare“; no payment from it has been reported.
Who wanted something
The plaintiffs were the ones asking: they filed the $10 billion suit in January 2026 over the 2019-20 leak of Trump’s tax returns. They got an apology and the bar on IRS tax claims. The Justice Department, under acting Attorney General Todd Blanche, announced the settlement.
Who lost out
Taxpayers were committed to a $1.776 billion fund drawn from the Judgment Fund until Blanche rescinded it on August 2, 2026. The IRS lost its ability to pursue tax claims against the plaintiffs. Judge Williams found the suit collusive.
Why it matters
A judge found on July 13, 2026 that the suit Trump filed against the IRS was collusive, and sanctioned his lawyers. The settlement had created a $1.776 billion fund and barred IRS tax claims against the plaintiffs. The fund was rescinded on August 2. No payment from it has been reported.
Sources U.S. Department of Justice (primary)ABC NewsCBS NewsUSA Today (via The Post and Courier)