The Internal Revenue Service building is seen in February 2025 in Washington, D.C.
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President Trump is moving to dismiss a $10 billion lawsuit he filed against the IRS over the leak of his tax returns, according to a court filing.
That could pave the way for a big settlement with the government he leads even as ethics watchdogs and Democrats in Congress are trying to intervene.
Trump and the Trump Organization sued the Internal Revenue Service and the Treasury Department in January demanding $10 billion over the leak of his tax returns years ago.
Legal experts described the case as weak, since the leak has been attributed to a federal contractor, not a full-time employee of the U.S. government. That man is currently serving prison time. They also questioned whether the statute of limitations might have expired; the leaks of tax information happened between 2018 and 2020.
But the Justice Department recently told a judge it had entered negotiations to resolve the dispute. That could mean the government Trump leads would be in line to pay him personally.
U.S. District Judge Kathleen Williams of Miami is presiding over the case. The judge recently raised her own doubts, citing Trump’s own rhetoric that in some ways, he was negotiating with himself as both plaintiff and president.
”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,” Judge Williams wrote last month. ”Indeed, President Trump’s own remarks about this matter acknowledge the unique dynamic of this litigation. Accordingly, 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.”
There’s a process in place at the Justice Department for people who say they’ve been harmed by the federal government.
In the normal course of business, those claims get evaluated by career lawyers. They rarely involve high-profile criminal investigations like Trump’s.
“Some of them are run-of-the-mill, right?” said Rupa Bhattacharyya, a former Justice Department lawyer who evaluated these kinds of allegations. “Postal vehicles get into traffic accidents, Veterans Affairs doctors have malpractice claims brought against them, people slip and fall in federal buildings.”
Even in the most serious cases, like ones that involved injuries to people cleaning up after the terrorist attack on Sept. 11, 2001, Bhattacharyya said the payouts almost never amounted to more than $10 million.
Edward Whelan, a prominent conservative lawyer, told NPR it would make sense to pause the litigation until Trump leaves the White House.
“There is a glaring conflict of interest with Trump being on both sides of the claim,” said Whelan, a former lawyer at the Justice Department who once clerked for the late Justice Antonin Scalia. “It is outrageous that he and those answering to him would be deciding how the government responds to these extravagant claims.”
