Trump Officials Are Reportedly Discussing Whether To Pay Trump a Settlement in IRS Lawsuit

[BumRushDaShow]

Source: MEDIAite

May 12th, 2026, 10:34 pm


The Department of Justice is having “internal discussions” about potentially settling President Donald Trump’s lawsuit against the Internal Revenue Service, The New York Times reported on Tuesday night. In January, the president sued his own administration for $10 billion in damages stemming from a leak of his tax returns that occurred during his first term. His sons Donald Trump Jr. and Eric Trump, who run the Trump Organization, are also suing.

Based on the leaks, the Times reported in 2020 that the billionaire president paid just $750 in income tax in 2016 and in 2017. “The IRS wrongly allowed a rogue, politically-motivated employee to leak private and confidential information about President Trump, his family, and the Trump Organization to the New York Times, ProPublica and other left-wing news outlets, which was then illegally released to millions of people,” a Trump spokesperson said in January.

The leaks were the handiwork of Charles Littlejohn, a former IRS contractor who worked for Booz Allen. He pleaded guilty to unauthorized disclosures of tax returns and was sentenced in 2024 to the maximum of five years. Last month, lawyers for the president asked a federal judge for a 90-day extension with respect to a key deadline in the case, suggesting that a settlement may be near. On Tuesday, the Times said settlement talks are underway, citing three people familiar with the situation.

“Whether to settle the suit and on what terms remains up in the air,” the paper stated. “One of the settlement options the Justice Department and White House officials are reviewing is the possibility of the I.R.S. dropping any audits of Mr. Trump, his family members or businesses, according to two of the people.”. The DOJ is representing the IRS in the case. That is the same DOJ that is helmed by acting Attorney General Todd Blanche, who served as Trump’s personal attorney in between presidential terms.

Read more: https://www.mediaite.com/politics/trump/trump-officials-are-reportedly-discussing-whether-to-pay-trump-a-settlement-in-irs-lawsuit/

[Vinca]

1. At the very least, he should prove there was harm done to him. From what everyone can see, he's made

billions upon billions upon billions since that happened, grifting his way to multi-billionaire status. They're treating the treasury like a piggy bank.

[Botany]

2. Abe Lincoln said of his Sec. of the Navy would have stolen a wood stove if it wasn't too hot.

Trump is a fucking thief.

[tanyev]

3. It's just one giant criminal gang doing government cosplay for profit and amusement.

[sop]

4. In a sane world, Trump would have to pay back taxes to the IRS after the leaker revealed he only paid $750,

and Littlejohn would receive a cash award. Only in the totally fucked-up Trumpiverse do tax cheats get billion dollar settlements from the IRS when their theft is exposed.

[Roy Rolling]

5. Sure

Pay him $1 and move on.

Fuck him. Fold your hand and wait for the next deal.

He’s the worst negotiator in history. Except if you put him in context of being a a Russian agent. Then he’s a bad negotiator because he’s a Russian agent.

[magicarpet]

6. Incestuous relationships are trDUMP's cup of tea. Todd Blanche being DjT's former personal attorney,..

.... and now head of the USDOJ as lead attorney in an IRS lawsuit settlement deal is conflict of interests normalized and institutionalized. As djt weaponizes the DOJ to become his personal attack dog like a Mafioso hoodlum would.

[eShirl]

7. make it conditional on his resignation

[RainCaster]

8. So the IRS sullied his reputation? what's that worth?

I'm my mind, TSF has destroyed his own reputation so bad that what the IRS did doesn't amount to a plugged nickel. Anyone who gives him more than that should be held to account.

[sinkingfeeling]

9. USA bankruptcy has been scheduled for November 2028.

[bluestarone]

10. He is so sick and tiring to listen to

In our country he IS GOD!! Jesus Christ, please stop his blood flow!!

[Bayard]

11. OUR money to pay this carpetbagger!

HIS money that should have become OUR money. Don't you DARE give him a dime!

[Firestorm49]

12. If this goes to fruition, which I hope it doesn't, maybe the settlement can include his prior tax returns.

[thesquanderer]

13. A variation of "mostly I consult with myself." (n/t)

[thesquanderer]

14. re: "the possibility of the I.R.S. dropping any audits of Mr. Trump"...

...so this means we'll finally get to see all his tax returns, right?

[LetMyPeopleVote]

15. MaddowBlog-Judge questions whether Trump can sue his own administration for $10 billion

If the president was waiting for a payout from his IRS lawsuit, a federal judge suggested he might need to start lowering his expectations.

Judge questions whether Trump can sue his own administration for billion

www.ms.now/rachel-maddo...

— Mike Walker (@newnarrative.bsky.social) 2026-04-27T19:11:24.754Z

https://www.ms.now/rachel-maddow-show/maddowblog/judge-questions-whether-trump-can-sue-his-own-administration-for-10-billion

In response to highly dubious civil lawsuits, the Trump Justice Department has been exceedingly generous lately, agreeing to lucrative settlements with plaintiffs who are politically aligned with the White House. Whether Donald Trump will be among the beneficiaries, however, remains an open question.

A federal judge suggested late last week that the president might have to lower his expectations. Politico reported:

President Donald Trump’s $10 billion lawsuit against the IRS over the leaking of his tax returns ran into turbulence Friday as a judge ordered a hearing on whether the Constitution allows the president to sue the federal government he oversees.

U.S. District Court Judge Kathleen Williams has asked Trump’s private attorneys and Justice Department lawyers representing the IRS to address whether his control over the government’s actions in the case means it’s the kind of dispute federal courts cannot consider.

“Although President Trump avers that he is bringing this lawsuit in his personal capacity, he is the sitting president and his named adversaries are entities whose decisions are subject to his direction,” Williams wrote in a four-page order.

“It is unclear to this Court whether the Parties are sufficiently adverse to each other so as to satisfy Article III’s case or controversy requirement,” the judge added, referring to the Constitution.....

Shortly after his lawyers filed the case, the president told reporters that he assumed “nobody would care” if he received a lucrative payout as part of the frivolous litigation. That payout now appears in doubt. Watch this space.

We spent maybe part of one Constitutional law class on the case or controversy provision of the Constitution. This usually came up in the cases dealing with advisory opinions. Here is the relevant part of the UN Constitution

Article III, Section 2, Clause 1:

The judicial Power shall extend to all Cases, in Law and Equity, arising under this Constitution, the Laws of the United States, and Treaties made, or which shall be made, under their Authority;—to all Cases affecting Ambassadors, other public Ministers and Consuls;—to all Cases of admiralty and maritime Jurisdiction; to Controversies to which the United States shall be a Party;—to Controversies between two or more States; between a State and Citizens of another State, between Citizens of different States,—between Citizens of the same State claiming Lands under Grants of different States, and between a State, or the Citizens thereof, and foreign States, Citizens or Subjects.

Since trump is on both sides of this silly lawsuit, there is no Case or Controversy.

[muriel_volestrangler]

16. If they drop the future audits, then he'll be demanding his tax returns earn him the Nobel Prize for Literature

in addition to everything else. Works of complete fantasy.

[BeneteauBum]

17. How can even consider payment?

Peace ☮️

[louis-t]

18. Give him $100 and tell him to STFU.

Jeez.

[mdbl]

19. All I can say about all this is,,,, WTF!

This is the craziest ass shit to date. A felon who defrauded the federal govt is going to sue? and they are going to pay more taxpayer money to this moron family than what has already been wasted? Just WTF!

[BigmanPigman]

20. Every day is worse then the day before.

tRump and Virginia Foxx are a match made in hell. I bet Satan wouldn't even let them in when they eventually drop dead and rot.

[LetMyPeopleVote]

21. MaddowBlog-Democrats condemn 'slush fund' as Trump eyes possible settlement with the IRS

Sen. Elizabeth Warren characterized the purported deal as an “insane level of corruption — even for Trump.”

A year ago, Trump endorsed a “compensation fund” for Jan. 6 rioters, though it wasn’t clear where he expected to get the money.

Now we know: He’d get it from us, in the form of a settlement agreement that results in a giant pool of money his team could use to reward his allies without oversight.

— Steve Benen (@stevebenen.com) 2026-05-15T17:42:13.603Z

https://www.ms.now/rachel-maddow-show/maddowblog/democrats-condemn-slush-fund-as-trump-eyes-possible-settlement-with-the-irs

More than three months later, as settlement talks between the agency and the Republican’s lawyers continue, money for “charity” doesn’t appear to be the principal goal. ABC News reported:

President Donald Trump is expected to drop his $10 billion lawsuit against the Internal Revenue Service in exchange for the creation of a $1.7 billion fund to compensate allies who claim they were wrongfully targeted by the Biden administration, sources familiar with the matter told ABC News.

The commission overseeing the compensation fund would have the total authority to hand out approximately $1.7 billion in taxpayer funds to settle claims brought by anyone who alleges they were harmed by the Biden administration’s “weaponization” of the legal system, including the nearly 1,600 individuals charged in connection with the Jan. 6 Capitol attack as well as potentially entities associated with President Trump himself.

....Rep. Jamie Raskin of Maryland, the top Democrat on the House Judiciary Committee, issued a related statement, saying, “Donald Trump is orchestrating a $1,700,000,000 fraud on the American taxpayer to line the pockets of his MAGA political allies, another installment in his 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.”

Raskin’s statement went on, “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. … This is a giant affront to the rule of law and a danger to the American system of justice.”

It’s easy to forget, but just two months into his second term, the president endorsed the idea of a possible “compensation fund” for rioters who attacked the U.S. Capitol in his name. Trump didn’t elaborate on the details, but taken at face value, he appeared to describe what would effectively be financial rewards for the criminals he pardoned.

It wasn’t clear at the time where exactly he expected to get the money. Fourteen months later, the answer appears to be coming into focus: Trump would get the money from taxpayers, in the form of a settlement agreement that results in a giant pool of money his team could use to reward his allies. Watch this space.

The only way to do this settlement is to have a valid lawsuit or court action. This lawsuit will be dismissed because of (a) statute of limitations and (b) the lack of judicial jurisdiction due to there being no "case or controversy."