Justice Department drops Trump tax claims

The Justice Department on May 19 added a one-page provision to its settlement with President Donald Trump that bars the federal government from pursuing pending tax claims against Trump, his sons and the Trump Organization. The addendum, signed by Acting Attorney General Todd Blanche, says the United States is “forever barred and precluded” from prosecuting or pursuing claims that “have been or could have been” asserted by the Internal Revenue Service against Trump, his family or related businesses. The move came one day after Trump and his co-plaintiffs dropped a $10 billion lawsuit against the IRS and Treasury Department over leaked tax returns. The settlement also followed the creation of a nearly $1.8 billion “Anti-Weaponization Fund,” according to Justice Department statements. ### What did the Justice Department actually agree to? Todd Blanche’s addendum says the government will not seek audits, payments or other relief tied to matters that were pending or could have been pending before federal agencies, including tax returns filed before the settlement’s effective date of May 18. NBC News reported the language covers Trump, his sons Donald Trump Jr. and Eric Trump, their company, and other family members and businesses. Politico reported the waiver also refers to related trusts, affiliates and subsidiaries. (nbcnews.com) The Justice Department said in a statement that the settlement applies “only with respect to existing audits, not future.” That qualification appeared in responses to news organizations after the addendum was posted. NPR, citing the document, reported that the government is barred from examining or prosecuting Trump, his sons and the Trump Organization over current tax issues. (nbcnews.com) ### How does this connect to Trump’s lawsuit against the IRS? Trump’s lawsuit sought $10 billion over the leak of his tax return information. NPR reported on May 18 that Trump and the Trump Organization had sued the IRS and Treasury Department in January and then moved to dismiss the case as settlement talks advanced. Judge Kathleen Williams, the federal judge in Miami overseeing the case, closed the matter on May 18 after the Trumps moved to dismiss it. (nbcnews.com) The Justice Department said the lawsuit’s dismissal was part of a broader agreement that also covered claims tied to the 2022 Mar-a-Lago search and the Russia investigation. NBC News reported those claims were dropped “in exchange” for the new compensation fund, which the department said would create a process for people alleging political “weaponization” or “lawfare” to seek redress. (wgbh.org) ### Why has the addendum drawn so much attention? The addendum was not included in the nine-page settlement agreement the department released on May 18. Politico reported the new page was posted early on May 19, bears Blanche’s signature, and does not show signatures from an IRS representative or Trump’s current lawyers. Politico also reported metadata indicated the document was prepared or scanned at 7:50 a.m. Tuesday. (nbcnews.com) John Koskinen, who served as IRS commissioner from 2013 to 2017, called the expanded settlement a “terrible precedent” in comments reported by Politico. Associated Press, carried by NPR affiliates and PBS, said Democrats and ethics watchdogs criticized both the tax waiver and the $1.776 billion fund as corrupt, opaque or unconstitutional. Senate Majority Leader John Thune told reporters he was “not a big fan” of the fund, according to the AP report. (politico.com) ### What is the government saying in defense of the deal? The Justice Department said the waiver was a customary part of settling claims that were or could have been brought by either side. Politico quoted the department as saying there would be little point in settling significant claims if one party could then pursue more adverse claims that could have been raised earlier. NBC News separately reported a department spokesperson said the agreement was limited to existing audits. (politico.com) Reuters reported the one-page document was released Tuesday and described it as a bar on audits into past tax claims for Trump, his relatives and his companies. AP reported the White House referred questions to the Justice Department and Treasury did not respond to requests for comment. ### What comes next, procedurally? (politico.com) The settlement is now part of a closed civil case after Williams ordered the matter shut on May 18. The addendum remains posted on the Justice Department website, and the New York Times published the text of the provision in an interactive document on May 19. Blanche also faced questions on Capitol Hill on May 19 about the related $1.776 billion fund, according to AP and Reuters. (wgbh.org) (usnews.com)