Back to Headlines
Politics
May 18, 2026
Analyzed by GPT OSS 120B

Trump Withdraws $10bn IRS Lawsuit, Announces $1.77bn Anti‑Weaponisation Fund

AI Summary
Former President Donald Trump has formally withdrawn his $10 billion lawsuit against the IRS and the DOJ has created a $1.77 billion Anti‑Weaponisation Fund to compensate allies who claim they were targeted by government investigations. The move has sparked immediate political backlash and raises unanswered legal questions about the fund’s use and the dismissal of the suit.

Donald Trump has formally withdrawn his $10 billion lawsuit against the Internal Revenue Service and the Department of Justice announced a $1.77 billion Anti‑Weaponisation Fund that would compensate political allies who say they were subjected to "weaponisation" and "lawfare".

Withdrawal of the $10bn IRS Lawsuit and Creation of the Anti‑Weaponisation Fund

  • Filed in a Florida federal court on May 18, 2026; terms of any settlement were not disclosed.
  • The DOJ’s press release frames the fund as a systematic process to hear and redress claims of weaponisation.
  • The lawsuit originated from former IRS contractor Charles Littlejohn's 2019‑2020 leak of Trump’s tax returns.
  • Littlejohn pleaded guilty to improper disclosures and received a five‑year prison sentence in 2023.

Financial Scope: $1.77bn Fund and $10bn Claim Figures

  • Original claim: $10 billion damages against the IRS.
  • Proposed compensation pool: $1.77 billion (often rounded to $1.8 billion in commentary).
  • Potential beneficiaries have not been publicly identified.

Political Ramifications and Legal Controversy

  • Rep. Jamie Raskin (D‑MD) called the fund "unconstitutional" and likened it to a pardon.
  • California Governor Gavin Newsom and Rep. Pramila Jayapal condemned the use of taxpayer money for allies.
  • Watchdog group Citizens for Responsibility and Ethics (CREW) announced an investigation into fund allocation.
  • The filing raises questions about whether a president can sue his own government and whether the case can be dismissed for lack of an adversarial party.

Future Outlook: Legal Challenges and Potential Use of the Fund

  • U.S. District Judge Kathleen Williams scheduled a hearing for May 27, 2026 to decide if the suit should be dismissed.
  • If dismissed, the fund could be implemented without further judicial oversight, pending DOJ guidelines.
  • Potential constitutional challenges may focus on the Domestic Emoluments Clause and separation of powers.
  • Continued scrutiny from Congress, media, and ethics watchdogs is expected as details of fund distribution emerge.