President Trump dismissed his $10 billion lawsuit against the IRS and Treasury Department on Monday, according to a Miami federal court filing. The settlement establishes a $1.776 billion fund to compensate individuals who allege they were wrongfully targeted by the Biden administration, including Jan. 6 defendants.
The fund creates an unprecedented taxpayer-backed mechanism for claims of government weaponization. Trump, his two eldest sons and the Trump Organization will receive a formal apology but no payment under the terms. The case was dismissed with prejudice, preventing Trump from refiling.
Trump originally sued the IRS after a former contractor leaked his confidential tax returns to The New York Times and ProPublica during his first term. The contractor pleaded guilty and was sentenced to federal prison. Multiple outlets had reported that Trump was considering the nearly $1.8 billion fund during settlement talks.
Monday's filing did not specify whether the agencies reached a separate settlement with Trump. The unusual case involved Trump demanding compensation from the very agencies he oversees as president. Questions remain about how the fund will be administered and what criteria will determine eligibility.
Critics may argue the fund sets a troubling precedent by using taxpayer money to address grievances from a sitting president's personal lawsuit. The move could face legal challenges over its constitutionality and scope.