Por Matthew Stevenson
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| Photo by Markus Spiske |
If you are filling a scrapbook with little odds and ends on the end of the American democratic experiment, you might want to save an entire album for the Trump family’s $10 billion lawsuit against the Internal Revenue Service (IRS), which the Trump administration is close to settling with its patron Trump.
The origin of the lawsuit is a 2019 leak (by an IRS outside contractor) to the New York Times of certain Trump tax returns over a fifteen-year period.
The leaked filing showed that in many years—in theory, when Trump was raking in billions, according to his own chest-thumping on TV—Trump reported losses or paid only $750 (seven hundred and fifty dollars) in income tax.
As in law there is no such thing as a humiliation clause for unfrocked billionaires, Trump was forced to sue in 2026 on the grounds that he and his family (he’s bringing his sons and the family business to the after-party) had suffered $10 billion in damages over the leaked tax returns—although it takes quite a lot of hoop-jumping to prove that someone paying $750 in income tax incurred losses in the 10-digit range.
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The magic of the lawsuit is that both the Department of Justice, which was served with the Trump lawsuit, and the Internal Revenue Service (part of the Treasury Department), both report to Trump, and heading both departments are Trump placemen.
To resolve this matter, all the Justice Department would have to do is claim that the Trump lawsuit is unwinnable (from the government’s side) and “settle” the case with the president for the demanded $10 billion.
After all, both cabinet officers serve at the pleasure of the president, and nothing would give President Trump more pleasure than to shake down the U.S. government for a cool ten billion.
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That the Trump lawsuit is frivolous is beside the point, just as it was when the former National Security Advisor Michael Flynn sued the U.S. government for $50 million for “malicious prosecution” and collected $1.2 million in a settlement—even though Flynn himself pled guilty to the charges.
In the Trump tax case, even a junior lawyer with the Legal Aid Society could win the case against plaintiff Trump, if for no other reason than that the two-year statute of limitations has run its course on a matter that dates back to 2019.
Second, and equally fatal to Trump’s assertions, is that legal statutes require that in all federal cases an adversarial relationship exist on both sides of a lawsuit; in this instance (with Trump, in effect, suing himself), no such conflict is in place.
Finally, what harm was done to Trump’s political or business prospects? After the leak placed him in the $750-a-year tax bracket, he was elected president in 2024, and in 2025 (while moonlighting from the Oval Office), he earned billions in all sorts of business schemes—from the issuance of personal meme coins to stock jobbing the float of Trump Media shares on Wall Street.
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Unfortunately, for the taxpayers who will eventually have to absorb whatever money is paid out to Trump and his family from the U.S. Treasury, the merits in the case will have nothing to do with the potential settlement, as those who will sign off on any deal with the Trumps are best understood as lackeys and yes-men.
The only signatures needed for the settlement with Trump must come from his Acting Attorney General Todd Blanche (who used to serve as one of Trump’s personal lawyers) and Treasury Secretary Scott Bessent (himself a billionaire) who over the years has raised millions of dollars for Trump’s political campaigns (which got him the Treasury job in the first place, where he has toed the Trump line and gutted the IRS, among other agencies).
Do either of these men want to haggle with Trump over an odd billion or two?
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The reason that Trump remittance men are rushing to “settle” the IRS case now is that there is a significant risk that, within the next several weeks, Florida District Judge Kathleen M. Williams might dismiss the case for some of the reasons mentioned here.
Already, Williams has strengthened her own hand by asking six private attorneys with tax experience to opine on whether federal statutes allow Trump to sue Trump, and then for Trump to settle the case with Trump for ten billion.
Before such a ruling can be handed down, however, Trump could withdraw his lawsuit against the IRS and announce that he has reached a settlement with the justice and treasury departments (perhaps on the plane coming back from China with all his terra-cotta CEOs). In that case, Judge Williams would lose her authority over the matter.
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Another advantage of Trump settling with Trump out of court is that one of the terms of any deal, reportedly, is that the IRS would agree to drop all of its audits against Trump, his sons and the family businesses—a clause that could be worth another hundred million dollars to the Trump gang.
Beginning with the 2016 presidential campaign, Trump has argued that the reason he would not release any of his personal financial statements was because he was going through an IRS audit (back to about 2010 or so).
Since Trump has never released any consolidated balance sheets for his wealth, it can be presumed that the audits were never resolved (even though the IRS itself reports to the president).
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Normally, the news that the American president was shaking down the U.S. government for $10 billion might rouse some protest or opposition—perhaps even in the somnolent Congress. But apparently, the country is numb to Trump’s grifts and con games (an entire country cowed by one protection racket).
Finally, settling with the IRS for $10 billion (or for whatever amount) and being granted audit dispensation will give Trump an immunity trifecta.
Already, the Roberts court has conferred on Trump blanket immunity for any acts committed while in office (even those as grave as obstruction of justice or sedition).
Now, Trump may well be freed from paying income taxes (all those onerous checks he had to write for $750), and he will have established the precedent that it is perfectly legal for an American president to sue his own government and then settle out of court for any amount he or she might deem acceptable (to themselves).
Matthew Stevenson is the author of many books, including Reading the Rails; Appalachia Spring; The Revolution as a Dinner Party (China throughout its turbulent twentieth century); Biking with Bismarck (France during the Franco-Prussian War); and Our Man in Iran. Out not long ago were: Donald Trump’s Circus Maximus and Joe Biden’s Excellent Adventure, about the 2016 and 2020 elections, and The View From Churchill, about the places that shaped the life of the British wartime prime minister. His next books are Playing in Peoria (by bike across the American Mid-West) and Friends of Kind, a literary travel history of World War I.
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