Trump Nears $1.7 Billion IRS Settlement
President Trump is expected to drop his IRS lawsuit in exchange for a $1.7 billion fund to compensate allies.
Lauren Collins ·
Trump Poised to Settle IRS Suit for $1.7 Billion Fund
President Donald Trump is expected to withdraw his $10 billion lawsuit against the Internal Revenue Service (IRS) in exchange for the establishment of a $1.7 billion fund. This fund, intended to compensate allies alleging targeting by the Biden administration, is anticipated to be finalized in the coming days, according to sources familiar with the matter on May 14, 2026.
The proposed fund would be overseen by a commission with authority to disburse approximately $1.7 billion in taxpayer funds. These funds would address claims from individuals who assert harm from the Biden administration's alleged "weaponization" of the legal system. This includes nearly 1,600 individuals charged in connection with the January 6 Capitol attack, as well as potential entities associated with President Trump.
The settlement conditions reportedly include a public apology from the IRS and are a primary factor for Trump to drop various legal actions against the federal government. These actions include the $10 billion lawsuit concerning the 2019 leak of his tax returns and $230 million in legal claims related to the 2022 search of his Mar-a-Lago estate and the Russia collusion investigation.
While Trump is expected to be prohibited from directly receiving payments from these three specific legal claims, entities associated with him are not explicitly barred from filing additional claims. The fund would draw from the Treasury Department's Judgment Fund, a permanent appropriation for government settlements.