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Home Business & Finance
​IRS Aims to Track and Tax 5M Dual Citizens Next Year

Trump Settles IRS Tax Suit Using Public Money

Eriki Joan UgunushebyEriki Joan Ugunushe
4 months ago
in Business & Finance
Reading Time: 3 mins read
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Two police officers who defended the U.S. Capitol on January 6, 2021, have filed a major federal lawsuit to freeze a new $1.776 billion government fund. The money pool was created as part of a controversial settlement by the Justice Department to resolve a personal lawsuit filed by President Donald Trump against the Internal Revenue Service (IRS). The officers argue that the multi-billion-dollar program is completely illegal and will act as a taxpayer-funded pool to reward political rioters.

Table of Contents

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  • A Multibillion-Dollar Deal Turns a Private Lawsuit
  • Capitol Police Officers Sue to Stop Payouts
  • A Dangerous Blueprint for Legal Extortion

A Multibillion-Dollar Deal Turns a Private Lawsuit

The dispute began when President Trump, his two eldest sons, and the Trump Organization filed a massive $10 billion lawsuit against the IRS. The family claimed that the unauthorized leak of their private tax returns to the media caused massive reputational and business damage. Instead of fighting the case in open court, the administration agreed to drop the lawsuit in exchange for a formal apology and the creation of the “Anti-Weaponization Fund.”

Trump Settles IRS Tax Suit Using Public Money

The money for this new program is coming directly from the federal Judgment Fund, a permanent pool of public taxpayer cash used to resolve legal claims against the government. Under the settlement rules, individuals who believe they were unfairly targeted, investigated, or prosecuted by past administrations for political or ideological reasons can apply for financial payouts. Acting Attorney General Todd Blanche will appoint a five-member commission to oversee the distributions, and the entire process will happen behind closed doors away from public court scrutiny.

Capitol Police Officers Sue to Stop Payouts

The creation of the massive public fund immediately triggered a fierce legal backlash. Former Capitol Police Officer Harry Dunn and active Metropolitan Police Officer Daniel Hodges filed a joint complaint in a Washington federal court to dismantle the program. Both officers suffered severe injuries during the January 6 Capitol riot and have faced ongoing harassment and death threats for speaking out publicly.

The officers’ lawsuit raises several serious arguments against the Trump administration. The lawsuit argues that the fund directly violates the U.S. Constitution, which explicitly bans using federal money to pay off debts or claims linked to an insurrection or rebellion.

The plaintiffs state that Congress never passed a law authorizing the executive branch to invent a brand-new $1.7 billion compensation program out of a private settlement. During a tense congressional hearing, Acting Attorney General Todd Blanche explicitly refused to rule out letting January 6 rioters receive payouts. Because Trump already used his presidential pardon powers to erase the criminal cases of nearly 1,500 rioters, the officers argue these individuals can now use the fund to collect millions in taxpayer dollars for legal fees and prison time.

A Dangerous Blueprint for Legal Extortion

This settlement is one of the most shocking abuses of public funds in modern history. There is an incredibly dangerous double standard happening here. If an ordinary citizen sues a government agency and settles, they might get a personal check from the state. They do not get to rewrite federal policy, bypass Congress, and force the U.S. Treasury to set up a secretive $1.7 billion bank account controlled by their own hand-picked allies.

Using a leak of tax returns as an excuse to build a massive financial reward system for political supporters completely undermines the rule of law. It sends a terrifying message to the entire country: if you commit violence or break the law in the name of the president, you won’t just get a presidential pardon, you might eventually get a giant financial payday funded by the very taxpayers you attacked.

Furthermore, keeping the entire payout process completely hidden from the public eye removes any form of democratic accountability. The government’s Judgment Fund exists to settle legitimate legal wrongs, not to serve as a private vault for an administration to distribute wealth to its favorite groups. Officers Dunn and Hodges are completely right to fight this in court. If a president can use a personal grievance to manufacture a billion-dollar public program out of thin air, the barrier between public service and personal profit has completely evaporated.

Tags: federal characterForeign NewsgovernmentIRS Tax SuitNewsPublic Moneytrump
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Eriki Joan Ugunushe

Eriki Joan Ugunushe

Eriki Joan Ugunushe is a dedicated news writer and an aspiring entertainment and media lawyer. Graduated from the University of Ibadan, she combines her legal acumen with a passion for writing to craft compelling news stories.Eriki's commitment to effective communication shines through her participation in the Jobberman soft skills training, where she honed her abilities to overcome communication barriers, embrace the email culture, and provide and receive constructive feedback. She has also nurtured her creativity skills, understanding how creativity fosters critical thinking—a valuable asset in both writing and law.

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