The I.R.S. Thought It Could Fight Trump's Lawsuit, but It Reached a Deal Anyway

[mahatmakanejeeves]

Source: New York Times

The I.R.S. Thought It Could Fight Trump's Lawsuit, but It Reached a Deal Anyway

Officials wrote a memo outlining ways to challenge President Trump's suit against the Internal Revenue Service. The administration is instead creating an "anti-weaponization" fund.


President Trump sued the Internal Revenue Service in January, claiming that the agency had not done enough to prevent the leak of his tax information. Haiyun Jiang/The New York Times

By Andrew Duehren
Reporting from Washington

May 19, 2026
Updated 12:38 p.m. ET

Lawyers at the Internal Revenue Service sought to contest President Trump's lawsuit against the agency, recommending several potential defenses in a case that the Justice Department nevertheless decided to resolve by creating an extraordinary $1.8 billion fund that could soon be used to pay Mr. Trump's political allies. ... I.R.S. officials prepared a 25-page memorandum outlining what they saw as flaws in Mr. Trump's suit and advising the Justice Department to move to dismiss it, according to two people familiar with the memo. That memo was provided to Treasury officials in April, and it is unclear if they passed it along to its intended recipients at the Justice Department, according to the people, who spoke anonymously to discuss internal government deliberations.

No lawyers from the Justice Department ever appeared in court to respond to the suit or disputed any of Mr. Trump's claims, which demanded at least $10 billion from the I.R.S. for not doing enough to prevent the leak of his tax information. The Justice Department instead made a highly unusual deal in the case. In exchange for Mr. Trump dropping the suit, the Trump administration created the $1.776 billion "anti-weaponization" fund for people who say they were wrongly targeted by the federal government.

The existence of the internal memo, which has not been previously reported, shows that the Trump administration disregarded readily available defenses to a lawsuit filed by the president against an agency he controls. While the Justice Department has said that Mr. Trump will not receive money from the new fund, critics have slammed the arrangement as a corrupt attempt at paying Mr. Trump's political supporters, including, potentially, those who were convicted and later pardoned for storming the Capitol on Jan. 6, 2021. ... The Treasury Department and the I.R.S. did not respond to requests for comment. The Justice Department did not respond to questions about why it chose to settle the case.

{snip}

Frank Bisignano, who is working in the newly created role of chief executive of the I.R.S., signed the agreement with the Justice Department to create the fund. Mr. Bisignano was not confirmed by the Senate to that I.R.S. job, and he is splitting his duties there with his job as the commissioner of the Social Security Administration.

Andrew Duehren covers tax policy for The Times from Washington.
https://www.nytimes.com/by/andrew-duehren

Read more: https://www.nytimes.com/2026/05/19/admin/irs-trump-lawsuit-deal.html

[dweller]

1. The Pisswig withdrew the suit against the IRS without

a settlement .

The $1.8 billion ($1.776 billion) "Anti-Weaponization Fund" was established via an out-of-court settlement agreement between President Donald Trump and the Internal Revenue Service (IRS), rather than by a traditional judicial ruling. The nine-page settlement document was signed by acting Attorney General Todd Blanche

😐



✌🏻

[sop]

2. The IRS never intended on "fighting" Trump's lawsuit, certainly not at the highest level.

IRS Chief Executive Officer Frank Bisignano ("a newly created position" which didn't exist before Trump) is the guy in charge of all day-to-day operations at the IRS. Frank was put in place late last year (2025), before Trump's $10B suit was filed. Ostensibly, Bisignano was the one at the IRS who "negotiated" this $1.776 billion "settlement." Bisignano was appointed by, and reports directly to, Secretary of the Treasury Scott Bessent.

Before Trump appointed him as Secretary of the Treasury, Bessent served as an "economic advisor, fundraiser, and major donor for the Donald Trump 2024 presidential campaign." Bisignano also "donated over $125,000 to Trump's 2020 presidential campaign," and through his wife, Tracy, "donated over $931,000 to Trump's 2024 campaign."

Acting Attorney General Todd Blanche, the guy Trump put in charge over at the DOJ after Bondi was fired for not being sufficiently corrupt, and the one who approved this $1.776 billion "settlement," was literally Trump's personal attorney, and acted as his lead defense attorney in three major Trump criminal trials: the Manhattan hush money case which resulted in a conviction on 34 felony counts, the federal classified documents case in Florida that alleged Trump mishandled classified records at his Mar-a-Lago estate, and the 2020 election interference case which accused Trump of conspiring to overturn his loss in the 2020 presidential election.

The fix was in on this "settlement" (theft) from the day Trump filed his $10B suit.

[ImNotGod]

3. There should be large class action suits by tax paying groups suing the IRS over this, the IRS would eventually have to

settle.

[wiggs]

4. that's why this is unprecedented, despite what Blanche says...there is no case, there are no damages, there are

no findings of injustice.

[sop]

5. The real "injustice" is that Trump only paid $750 in taxes in the first place.

And when an IRS whistleblower revealed he only paid $750 in taxes, Trump sued the IRS for $10 billion, claiming an "injustice" had been done, and he had been "damaged" because everyone found out he was a fucking tax cheat.

In a sane world Trump would be prosecuted and forced to pay his back taxes, with interest. But in this fucked-up bizarro world we live in, Trump is getting a $1.776 billion "settlement" from the U.S. treasury, simply because he was exposed as a fucking tax cheat.

The blood boils!

[Bayard]

6. And because this deal was made out of court,

There's no appealing it.

While regular people can't afford healthcare, groceries, or gas.

[sop]

8. It's the most corrupt "deal" ever made in the history lf the American presidency. From TPM:

- "A settlement agreement is signed by Trump’s personal attorney, the DOJ’s No. 3, and the IRS commissioner to resolve Trump’s collusive lawsuit against the IRS in federal court in Miami and establish an 'Anti-Weaponization Fund.' "

- "Trump dismisses his lawsuit before U.S. District Judge Kathleen Williams can weigh in on whether the IRS and Treasury Department are under Trump’s effective control, which would have ended the lawsuit and prevented any 'settlement.' "

- "The DOJ touts the settlement in a press release and issues a bare-bones summary of the 'Anti-Weaponization Fund.' "

- "With obvious reluctance, Williams, whose hands are tied by court rules, orders the Trump case closed.
The DOJ releases the settlement agreement itself."

- "Brian Morrissey, the general counsel of the Treasury Department, resigned Monday just hours after the 'Anti-Weaponization Fund' was announced and only seven months after he was confirmed as the department’s top lawyer.

"A few observations:"

"Six pages! The settlement agreement, at a mere six substantive pages, has to be among the skimpiest legal documents ever drafted for a settlement of this scale. The ratio of settlement agreement pages drafted to dollars committed is off the charts."

"How convenient! The settlement agreement contains a nifty provision that purports to allow only the collusive parties to the agreement — and no one else — to challenge it."

"Conflict of interest much? The No. 3 at DOJ, Stanley Woodward, represented a host of clients, including Jan. 6 defendants, who stand to be beneficiaries of the 'Anti-Weaponization Fund.' "

"A free-for-all! None of the documents released by the DOJ, including the settlement agreement itself, defines 'weaponization,' provides clear standards for reviewing claims, or otherwise establishes any guardrails for transparency of accountability."

https://talkingpointsmemo.com/morning-memo/picking-through-the-wreckage-from-the-worst-day-of-trump-ii-so-far

[Bengus81]

7. Those violent MAGOTS are going to see a "check" from this CON

about as fast a DOGE refund check, a tariff refund check, a Trump cell phone refund check....etc,etc.