After Donald Trump sued his own administration for $10 billion, pitting his personal lawyers against the Department of Justice, the president was gifted a broad, single-page document that gives him sweeping immunity from tax crimes.
Under the guise of a “settlement” between his lawyers and his administration, the president and his allies will both receive government handouts potentially worth tens of millions of dollars. Alleged “victims” of government “weaponization” can file for a piece of a nearly $1.8 billion compensation fund, while the president, his family and their businesses escape government scrutiny for tax debts over which they have been under investigation for more than a decade.
Legal experts tell The Independent that the agreement is a blatant and illegal act of self-dealing by the administration.
“There is a federal crime that prohibits exactly what the president did, and for exactly this reason, to prevent a corrupt president from using the IRS to their own advantage,” according to UC Berkeley Law professor Brian Galle, a former federal prosecutor with the Justice Department’s Tax Division.
“This is an episode that would have brought down any other presidency in American history,” he told The Independent.
The one-page agreement — printed on the Office of the Attorney General letterhead and signed by Trump’s former criminal defense lawyer and now Acting Attorney General Todd Blanche — “forever” blocks the federal government from “prosecuting or pursuing” any tax claims against the president, members of his family and their businesses.
Meanwhile, a five-member board made up of Blanche’s appointees will arrange payments from a $1.776 billion fund to recipients whose identities will remain secret. Blanche has publicly stated that Trump and his family are not eligible, but Blanche has not ruled out payments to the president’s donors and allies, raising questions about the process and who stands to benefit.
Top Democrats on the House Judiciary and Ways and Means committees are pressing the administration for answers.
“Never in American history has a president pursued corruption this brazenly or on such a colossal scale,” Reps. Jamie Raskin and Richard Neal wrote to Blanche, Treasury Secretary Scott Bessent and IRS CEO Frank Bisignano.
“Essentially, the federal government threw in a Super-Pardon for the president, his family, and related and affiliated entities, freeing them not only from any accountability for any taxes they may have dodged, but other pending federal criminal or civil investigations like insider trading, antitrust violations, false statements, or even sexual harassment,” they wrote Wednesday.
It’s unclear whether Trump’s attempts to evade the IRS and will survive in Congress or against a Democratically controlled White House.
Trump’s agreement, which applies only to existing audits, could spare the president and his family from a more than $100 million tax penalty.
An audit centered on a nearly $73 million tax refund Trump claimed around 2010, which the former real estate developer and reality TV host justified by reporting steep business losses, largely tied to his casino holdings and his Chicago skyscraper.
The IRS contended that Trump improperly claimed the same losses twice for the Chicago tower, where he reported losses of up to $651 million.
Trump, who has been fighting the audit for years, accused the IRS of failing to prevent the leak of his tax returns.
“The deal that Trump extracted from the government he leads is really a spectacular demonstration of the fact that there really are two sets of tax rules, one for those at the top, and another for the rest of us,” according to Steve Wamhoff, federal policy director with the Institute on Taxation and Economic Policy, a nonpartisan tax policy group.
“Trump and his officials view themselves as untethered from the tax laws that apply to normal Americans,” he told The Independent.
Tax schemes to support wealthy figures typically play out in obscure policy debates, but “this week is different because Trump distorted the tax system to blatantly help himself without even trying to hide the fact,” he said.
Federal law prohibits the executive branch from requesting — “directly or indirectly” — that the IRS terminate investigations into any taxpayer, let alone the president. “It says what the president did this week was a crime,” said Galle, the UC Berkeley Law professor.
That statute also requires IRS officers and officials who receive those requests to report them to the Treasury Department’s inspector general, the agency’s independent watchdog. Failure to do so can result in criminal prosecution.
“Trump’s dirty deal has crossed the line into illegality,” according to Robert Weissman and Lisa Gilbert, co-presidents of nonprofit consumer advocacy group Public Citizen.
“If Acting AG Todd Blanche tries to effectuate this settlement by directing the IRS to end audits underway or not to conduct audits it would normally undertake, both he and Donald Trump will be violating the law and putting IRS officers at risk,” they said.
A spokesperson for the Trump Organization said the settlement “seeks to provide meaningful accountability for the IRS’s prolonged and systemic failure to safeguard sensitive taxpayer data,” including the “unlawful disclosure” of tax information connected to Trump-affiliated entities.
The Supreme Court has ruled that the president is immune from criminal prosecution for official acts in office, a landmark decision that has tossed a grenade into Trump’s legal battles and could emerge as a defense in upcoming lawsuits over the IRS agreement.
“I guess we could debate until the cows come home whether canceling an audit for your family forever is an official act of the president,” Galle said. “I find that hard to swallow, but I’m sure his lawyers will be making it at some point, or his children’s lawyers will be making it.”
