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trump tax returns
'A $1,700,000,000 Fraud': Trump Set to Drop IRS Suit in Exchange for MAGA Slush Fund
"This is a massive and unprecedented presidential plunder of the American people," said Rep. Jamie Raskin.
May 15, 2026
The top Democrat on the House Judiciary Committee on Thursday accused US President Donald Trump of "orchestrating a $1,700,000,000 fraud on the American taxpayer to line the pockets of his MAGA political allies" amid new reporting on the terms Trump is seeking in talks to settle his $10 billion lawsuit against the Internal Revenue Service.
ABC News reported late Thursday that Trump is expected to drop his lawsuit in the coming days "in exchange for the creation of a $1.7 billion fund to compensate allies who claim they were wrongfully targeted by the Biden administration." The money would come from the Treasury Department's Judgment Fund, which pays out court judgments and settlements against the federal government.
The president is also expected to receive a public apology from the IRS for the leak of his tax returns during his first White House term.
Rep. Jamie Raskin (D-Md.) said in a statement that the reported settlement terms represent "another installment" in Trump's "ongoing effort to turn the federal government into a personal cash machine for his unpopular extremist movement."
"This is a massive and unprecedented presidential plunder of the American people," said Raskin. "Worse still, this is only the beginning—a declaration that the prior payouts were just a down payment, and that he now intends to earmark billions more in taxpayer dollars for his political allies, sycophants, and private militia of unemployed insurrectionists."
“The president has no authority to conjure up billion-dollar compensation schemes or raid the Judgment Fund, which exists to settle valid lawsuits. Trump is systematically converting neutral government mechanisms into a presidential slush fund to build his army of political dependents," Raskin continued. "Congress must act immediately to reassert the power of the purse and stop this brazen looting of taxpayer funds before this ‘pilot program’ for corruption becomes the permanent operating system of our government."
According to ABC, which cited unnamed sources who emphasized that the settlement's terms should not be considered final until officially announced, the deal is "expected to prohibit Trump from directly receiving payments related to those three legal claims; however, entities associated with Trump are not explicitly barred from filing additional claims."
"The arrangement would be an unprecedented use of taxpayer dollars with little oversight," ABC noted. "Under the terms of the potential settlement agreement, President Trump would have the authority to remove members of the commission running the fund without cause, and the commission would be under no obligation to disclose its procedures or decision-making process for awarding more than a billion dollars."
ABC's story came on the heels of reports earlier this week revealing internal Justice Department discussions on settling Trump's lawsuit, which he filed in late January. Last month, a federal judge questioned the constitutionality of Trump's suit, noting that "he is the sitting president and his named adversaries are entities whose decisions are subject to his direction."
"Real story: Judge was about to throw out the case because Trump controls both parties," Rep. Dan Goldman (D-NY) wrote late Thursday. "Before it’s dismissed, Trump tells both parties to reach a 'settlement.' Settlement shields Trump from any future audit and creates a secret slush fund that can dole out money to anyone with no transparency."
"Mind-boggling corruption," Goldman added.
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'Disgusting Act of Corruption': Trump Sues IRS, Treasury for $10 Billion Over Tax Return Leak
"While Trump is weaponizing taxpayer privacy laws for his own benefit, his Treasury Department is flouting those exact same laws to send tens of thousands of individual tax records to his anti-immigrant henchmen at ICE."
Jan 30, 2026
President Donald Trump has sued the US Treasury Department and Internal Revenue Service for $10 billion over the leak of his tax returns during his first term in the White House, when the president broke with decades of tradition by refusing to voluntarily divulge the records.
The lawsuit—joined by Trump's two eldest sons and his family business, the Trump Organization—was revealed Thursday in a filing with the Miami division of the US District Court for the Southern District of Florida. The suit alleges that the IRS and Treasury Department "caused Plaintiffs reputational and financial harm, public embarrassment, unfairly tarnished their business reputations, portrayed them in a false light, and negatively affected President Donald Trump and the other Plaintiffs' public standing."
Charles Littlejohn, a former IRS contractor who was employed by Booz Allen Hamilton, pleaded guilty in late 2023 to one count of unauthorized disclosure of tax return information and was later sentenced to up to five years in prison.
The US Treasury Department, led by Scott Bessent, announced earlier this week that it was canceling all of its contracts with Booz Allen Hamilton, accusing the company of failing to "implement adequate safeguards to protect sensitive data, including the confidential taxpayer information it had access to through its contracts with the Internal Revenue Service."
The leak included the tax records of Trump and other mega-rich Americans, including Amazon founder Jeff Bezos and Tesla CEO Elon Musk. The New York Times, which obtained the records along with ProPublica, reported in 2018 that the returns showed Trump engaged in "outright fraud" and other "dubious" schemes to avoid taxation.
Trump, according to the Times investigation, "paid $750 in federal income taxes in 2016, the year he was elected president, and... he had not paid any income taxes in 10 of the previous 15 years."
US Sen. Ron Wyden (D-Ore.), the top Democrat on the Senate Finance Committee, said in response to the president's lawsuit that “Donald Trump is a cheat and a grifter to his core, and for him to abuse his office in an attempt to steal $10 billion from the American taxpayer is a shameless, disgusting act of corruption."
"While Trump is weaponizing taxpayer privacy laws for his own benefit, his Treasury Department is flouting those exact same laws to send tens of thousands of individual tax records to his anti-immigrant henchmen at ICE," Wyden continued. "It is the height of hypocrisy for Trump to pretend he cares one bit about taxpayer privacy."
Journalist Tim O'Brien, who has covered Trump for decades, called the lawsuit "a flagrant and obvious conflict of interest."
"Trump oversees the IRS. He wants the IRS to pay him a big chunk of change," O'Brien wrote on social media. "He is, and always has been, in it for the money."
The lawsuit isn't the first time Trump has sought a large sum of taxpayer money from a federal agency during his second term in office. Last year, Trump demanded via an administrative claims process that the US Justice Department pay him roughly $230 million in compensation for federal investigations he has faced.
Trump launched his attempt to wring $10 billion in taxpayer money out of the Treasury Department and IRS as he and his allies worked to gut the tax agency, leaving it with inadequate staff and resources to audit wealthy individuals and large corporations. The IRS is currently headed by Frank Bisignano, who was named "chief executive officer" of the agency late last year.
In a letter to Bessent and Bisignano earlier this week, Wyden and a group of fellow Senate Democrats warned that "the administration’s plans for the IRS"—including painful budget cuts—"will shift the burden of audits more heavily onto working Americans while giving rich scofflaws and big businesses a green light to cheat on their taxes."
"The administration has failed to detail any serious plan to avoid that unfair outcome," the senators warned.
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'The Guy Is a Hero': IRS Contractor Who Leaked Trump Tax Returns Gets Max Sentence
"Billionaires control our lives and our government and pay... lower tax rates than the rest of us, but this is the bad guy who should be punished with a five-year prison sentence?"
Jan 29, 2024
As the U.S. tax season began Monday, a former Internal Revenue Service contractor who leaked to the media the tax records of wealthy Americans including ex-President Donald Trump was sentenced to five years in prison and ordered to pay a $5,000 fine.
U.S. District Judge Ana C. Reyes, an appointee of President Joe Biden, handed down the maximum sentence to Charles Littlejohn, who pleaded guilty to unauthorized disclosure of tax returns and return information in October. Littlejohn gave The New York Times information on Trump—who is expected to face Biden in the November election—and shared with ProPublica data on Jeff Bezos, Michael Bloomberg, Warren Buffett, Bill Gates, Rupert Murdoch, Elon Musk, Mark Zuckerberg, and more.
While Reyes called the decision to release Trump's filings "an attack on our constitutional democracy" and Littlejohn told the court that he "acted out of a sincere but misguided belief that I was serving the public," others framed the 38-year-old's move as heroic.
"This guy is a hero who showed us how the superrich steal from the American public,"
Slate politics writer Alexander Sammon said Monday. "Naturally, the judge gave him a max sentence, claiming it was 'a moral imperative' to punish him as harshly as possible."
Jeff Hauser of the Revolving Door Project noted that "this whistleblower's cause has been ignored by a LOT of people who have defended much more intrusive leaking. (Tax returns were public in the past, are in some countries now, and should be fully transparent—they're inherently public information, unlike, e.g., John Podesta's emails)."
People's Policy Project founder Matt Bruenig similarly pointed out that "in Finland, these returns are public record available to anyone who wants to see them."
After decades of presidential candidates voluntarily releasing income tax returns, Trump declined to do so—breaking his promise to make them public. The Republican also unsuccessfully fought to block Congress from receiving some of his tax records.
After the sentencing on Monday, Littlejohn's attorney told reporters that his only statement was to thank the court for consideration of the case. Meanwhile, Acting Assistant Attorney General Nicole M. Argentieri of the U.S. Department of Justice's (DOJ) Criminal Division said that his "sentence sends a strong message that those who violate laws intended to protect sensitive tax information will face significant punishment."
When Littlejohn pleaded guilty last year, ProPublica declined to comment other than reiterating that the news outlet "doesn't know the identity of the source who provided this trove of information on the taxes paid by the wealthiest Americans."
Charlie Stadtlander, a spokesperson for the Times, said last year that "we remain concerned when whistleblowers who provide information in the public interest are prosecuted. The Times' reporting on this topic played an important role in helping the public understand the financial ties and tax strategies of a sitting president—information that has long been seen as central to the knowledge that voters should have about the leader of our government and the candidates for that high office."
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