Donald Trump is expected to drop his $10 billion lawsuit against the Internal Revenue Service (IRS) in exchange for the establishment of a fund to compensate allies allegedly targeted by the Biden administration, sources familiar with the matter told ABC News.
Trump filed the $10 billion lawsuit against the IRS in January, alleging they failed to stop the unauthorized release of his tax returns by a government contractor who shared them with The New York Times in 2019.
A commission supervising the fund would have total authority to provide $1.7 billion in taxpayer finances to pay those claiming to have been targeted by the Biden Administration’s “weaponization” of the legal system, sources told the American broadcaster.
Such individuals would include organisations associated with Trump as well as about 1,600 people charged in relation to the January 6 Capitol attack.
Alongside a public apology from the IRS, the fund is believed to be the central condition for Trump to drop his legal actions brought against the federal government.
In addition to the IRS lawsuit, two legal claims Trump brought against the Justice Department are also reported to be part of the agreement. Collectively worth $230 million, they relate to the 2022 search of his Mar-a-Lago estate and investigations into whether his 2016 campaign had colluded with Russia.
Final terms are not yet agreed, and settlement is expected to be reached in the coming days, but they are said to prohibit Trump from directly receiving payments relating to those three legal claims. Entities associated with Trump, however, would reportedly not be explicitly barred.
A spokesperson for Trump’s legal team told ABC News: “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.
“President Trump continues to hold those who wrong America and Americans accountable.”
The Independent has approached the Justice Department, Treasury Department and IRS for comment.
Should the fund overcome anticipated legal obstacles, it is expected to be financed by the Treasury Department’s Judgement Fund, a reserve used by the federal government to pay court judgements and settlements, sources said.
According to proposed terms of the potential settlement, President Trump would have the power to remove members running the fund’s commission. The commission would also not be required to disclose its procedures for awarding payments of more than a billion dollars.
When asked about his legal action last October, Trump accepted the lawsuits “sort of looks bad,” but claimed he would donate any money received from the action to charity.
“It’s interesting because I’m the one that makes a decision, right, and, you know, that decision would have to go across my desk,” Trump said in the Oval Office last year. “It’s awfully strange to make a decision where I’m paying myself.”
Sources said any remaining funds would be returned to the government shortly before Trump leaves office.
