Trump Appeals Judge’s Ruling on IRS Lawsuit and Anti-Weaponization Fund

President Donald Trump’s legal team filed a notice of appeal on Friday in U.S. District Court in Miami, challenging U.S. District Judge Kathleen Williams’ order that found the president’s $10 billion lawsuit against the Internal Revenue Service (IRS) was brought in bad faith.

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The lawsuit stemmed from a 2020 leak of Trump’s tax returns. After years of litigation, the administration voluntarily dismissed the case in May 2026 and announced a settlement that created a compensation fund for individuals the Justice Department (DOJ) described as victims of “government lawfare.” The fund—referred to by the administration as the “anti-weaponization” or “lawfare” fund—was intended to distribute billions of taxpayer dollars to those groups. A separate DOJ memorandum, signed by Acting Attorney General Todd Blanche, barred the IRS from pursuing audits or investigations of Trump, his family members, and related entities, potentially leaving a tax liability of up to $100 million unresolved.

Trump files appeal after judge’s scathing order in his ‘bad faith’ IRS case

• May 2026 – Trump’s team withdrew the IRS suit; the DOJ announced the compensation fund.

Trump files appeal after judge’s scathing order in his ‘bad faith’ IRS case

• Friday (late July 2026) – Notice of appeal filed; Trump defended the fund at a Cabinet meeting at Camp David and on Truth Social.

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• $10 billion – Amount sought in the original IRS lawsuit.

Trump files appeal after judge’s scathing order in his ‘bad faith’ IRS case

• $1.776 billion, $1.8 billion, and $1.766 billion – Reported values for the anti-weaponization fund.

The Hill

• $100 million – Potential maximum tax bill that could remain unpaid if the DOJ memorandum remains in effect.

The Hill

Acting Attorney General Todd Blanche’s memo barred IRS enforcement actions against Trump and his affiliates, a provision that Senate Republicans have linked to the fund’s existence. Senator John Cornyn (R-TX) has demanded written assurances that the fund is defunct before confirming Blanche.

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Republican senators John Cornyn and Thom Tillis have opposed the fund, arguing that taxpayer money should not be allocated to political allies or individuals they label “victims of government abuse.” Their opposition has stalled Blanche’s confirmation, with the senators insisting on a written guarantee that the fund is terminated.

The Hill

• “In sum, the facts before this Court demonstrate there was never adverseness between the Parties; there was never a case or controversy; and there was never a question as to who would prevail,” — Kathleen Williams, district judge

The Hill

• “The nature of the suit itself and the conduct of the Parties and counsel from its filing make plain that this was an attempt to use the Court to provide some legitimacy to an agreement to confer immunity to people and entities affiliated with the President and to earmark billions of dollars from American taxpayers to redress grievances not defined in the law,” — Kathleen Williams, district judge

Trump files appeal after judge’s scathing order in his ‘bad faith’ IRS case

Sources differ on the precise size of the anti-weaponization fund, citing $1.776 billion, $1.8 billion, and $1.766 billion. No source provides a definitive reconciliation of these figures. The long-term legal status of the DOJ memorandum barring IRS enforcement remains unsettled pending the appeal and Senate action.

The Hill

The appeal will be heard by the 11th Circuit Court of Appeals. The Senate Judiciary Committee is expected to continue reviewing Todd Blanche’s nomination, with Republican holdouts demanding written confirmation that the anti-weaponization fund is permanently dissolved before any vote.

New York Times