Trump moves to drop $10bn US lawsuit against IRS

President Donald Trump moved to drop his $10 billion lawsuit against the Internal Revenue Service over the 2019 leak of his tax information.

The filing in Miami Monday morning contained few details other than the request to drop the suit by Trump’s lawyer, Alejandro Brito. US officials have discussed creating a $1.7 billion federal fund to pay victims of so-called government weaponisation to resolve the lawsuit, Bloomberg News has reported.

Under that arrangement, Trump wouldn’t receive any money directly under the deal. Instead, claims could be made by parties that allege they were victimised by the weaponisation of government under President Joe Biden. Critics have condemned this arrangement as an inappropriate “slush fund” to reward his political allies.

Those allies could include about 1 500 individuals who were prosecuted for storming the US Capitol on January 6, 2021, to try to prevent Biden’s election from being certified.

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Brito asserted in Monday’s filing that the deal doesn’t need approval from Judge Kathleen Williams, who has been critical of the relationship between Trump, the IRS and the Department of Justice.

The dismissal “requires neither leave of court nor the consent of any party,” Brito said.

The White House and DOJ didn’t immediately respond to requests to comment.

Executive authority

Since his return to office, Trump has pushed the limits of executive authority, from imposing tariffs and withholding federal funds to calling on the Justice Department to prosecute his perceived political enemies. Yet the IRS suit, which also named the US Treasury as a defendant, stands out in Trump’s use of presidential power in court.

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The lawsuit has raised conflict-of-interest questions about Trump, who has authority over the IRS and the Justice Department, which defends the government in lawsuits.

The IRS data leak at the center of the case was a significant blow to the agency. A former IRS contractor, Charles Littlejohn, pleaded guilty in 2023 to stealing tax records for thousands of wealthy Americans, including Trump, Ken Griffin, Elon Musk and Jeff Bezos, and leaking them to news organisations. Littlejohn was sentenced to five years in prison.

Based on the data, the New York Times reported on Trump’s tax information weeks before the 2020 presidential election, which he lost to Biden.

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