Trump-IRS Settlement: Tax Immunity and the Aborted $1.8 B Anti-Weaponization Fund

In May 2024, President Donald Trump withdrew a $10 billion lawsuit against the Internal Revenue Service after the Justice Department, led by Acting Attorney General Todd Blanche, offered a settlement. The deal permanently barred the IRS from pursuing tax examinations of Trump, his family, and affiliated entities for existing audits and created a $1.7-$1.8 billion “anti-weaponization” fund to compensate individuals claiming they were victims of politically motivated investigations. The fund was expected to benefit, among others, participants in the Jan. 6, 2021 Capitol attack.

BloombergThe IndependentSlateTalking Points Memo

• May 19, 2024 – Blanche signs a one-page memo “forever barring” IRS tax examinations of Trump and related parties.

Slate

• May 18-19, 2024 – DOJ announces the anti-weaponization fund and Trump’s dismissal of the lawsuit.

Talking Points Memo

• Late May 2024 – 35 former federal judges petition Judge Kathleen Williams to reopen the case, alleging collusion.

Talking Points Memo

• June 2, 2024 – Blanche tells Congress, “We are not moving forward with the fund. Period.”

Bloomberg

• Early June 2024 – Judge Leonie Brinkema issues a temporary restraining order blocking the fund; a hearing is set for June 12.

Slate

• June 5, 2024 – Judge Kathleen Williams reopens the IRS lawsuit, ordering written explanations from the DOJ and Trump’s counsel.

Slate

Judge Kathleen Williams invoked a federal procedural rule to assess whether the settlement was “collusive from the start.” She ordered the DOJ and Trump’s attorneys to explain potential conflicts of interest and set a June 12 deadline to address three allegations: collusion between parties, deceptive dismissal of the lawsuit, and the court being a “victim of fraud.” Simultaneously, Judge Leonie Brinkema’s restraining order halts any disbursement from the anti-weaponization fund pending a final decision.

SlateTalking Points MemoThe Independent

Democratic lawmakers have condemned both the tax-immunity provision and the fund. Rep. Rosa DeLauro (D-CT) said the deal “gave the president’s family tax immunity to the tune of about $100 million.” Sen. Ron Wyden (D-OR) called the settlement “a new high-water mark for public corruption.” Former Vice President Mike Pence described the fund as “deeply offensive” for potentially compensating Jan. 6 participants. Senate Republican leader Mitch McConnell labeled the fund “utterly stupid, morally wrong.” Treasury Secretary Scott Bessent declined to comment, citing ongoing litigation.

Newser

• Anti-weaponization fund: $1.7-$1.8 billion.

Bloomberg

• Estimated tax liability shielded for Trump: ? $100 million.

Bloomberg

• Forbes projected Trump could save over $600 million through the immunity clause.

The Independent

• Potential beneficiaries of the fund included Jan. 6 rioters and other self-identified “victims” of alleged government weaponization.

Bloomberg

Acting Attorney General Todd Blanche affirmed that the fund would not proceed and maintained that the tax-immunity provision remains in effect, describing it as “not blanket immunity” and limited to existing audits. Justice Department spokesperson Natalie Baldassarre noted that settlements typically include waivers of claims. Treasury Secretary Scott Bessent reiterated the department’s inability to comment due to ongoing litigation.

Newser

Sources differ on the scope of the tax-immunity provision: Blanche says it applies only to existing audits, DeLauro quantifies it as $100 million, and Forbes estimates $600 million in savings. The status of the anti-weaponization fund is also contested; Blanche declares it dead, yet judges have issued temporary blocks and the DOJ has not provided a written withdrawal. No final judicial ruling on the collusion allegations has been issued.

Slate

• “We are not moving forward with the fund. Period,” — Todd Blanche, Acting Attorney General

Slate

• “So, the nation’s top law enforcement official is asking for a slush fund to pay people who assault cops? Utterly stupid, morally wrong—take your pick.” — Mitch McConnell, Senate Republican Leader

Slate

• “You just gave the president’s family tax immunity to the tune of about $100 million,” — Rosa DeLauro, Representative

Bloomberg

• “I mean, it’s deeply offensive to me that you could have a fund that could even possibly compensate people who assaulted police officers or vandalized the Capitol on January 6th.” — Mike Pence, Former Vice President

Talking Points Memo

• “This little giveaway to Trump and his family gets them off scot-free,” — Scott Bessent, Treasury Secretary

The Independent

Judge Kathleen Williams expects written responses by June 12, after which she may decide whether to keep the case open. A separate hearing on Judge Leonie Brinkema’s restraining order is also slated for June 12. Democrats plan to introduce legislation to overturn the tax-immunity clause if they regain House control in the upcoming midterms. The DOJ’s next filing will determine whether it defends the settlement or concedes to judicial scrutiny.

Slate