The US Justice Department on Tuesday expanded its recent settlement of President Donald Trump’s lawsuit against the Internal Revenue Service (IRS) over the leaking of his tax returns, according to media reports.
The unusual agreement includes a pledge that the IRS will no longer pursue any claims against Trump, his family members and his companies over unpaid taxes.
The original settlement agreement with the Justice Department on Monday established a nearly $1.8 billion fund to “compensate victims of alleged weaponisation of law enforcement” but did not mention any resolution of disputes over Trump’s tax returns, which the president has repeatedly claimed were under protracted audits by the IRS.
But a document posted on the Justice Department’s website Tuesday stated that the IRS is “forever barred and precluded” from pursuing “examinations” of Trump, “related or affiliated individuals” and related trusts and businesses.
According to media reports, Acting Attorney General Todd Blanche signed the Tuesday addendum, but it did not have the signature of any IRS representatives or any current Trump lawyers. Blanche did not sign the original settlement agreement, which was signed by Associate Attorney General Stanley Woodward, IRS CEO Frank Bisignano and Trump attorney Daniel Epstein.
The Justice Department did not explain why Tuesday’s waiver was not included in the Monday settlement and why it was not signed by the same people.
“As is customary in settlements, both sides have executed waivers of a variety of claims that were or could have been brought,” the Justice Department said in a statement.
“There would be little point in settling several significant claims if either party could simply turn around and seek to (initiate) more adverse claims that could have been pursued previously,” the statement continued, adding: “This is only with respect to existing audits, not future.”
John Koskinen, who served as IRS commissioner from 2013 to 2017, told Politico that the expanded settlement set a “terrible precedent” that could effectively generate a “windfall” for Trump.
“It makes you wonder what the president has to hide in those tax returns,” said Koskinen. “He’s apparently been actively trading in the stock market and, since he knows a lot more about situations than the average investor, he’s probably generated significant taxable earnings. Not auditing his returns is the same as giving him an easy way to, in effect, receive money from the government.”
Danny Werfel, who was IRS commissioner from 2023 to 2025, told Politico that he was “unaware of a single precedent where the IRS has agreed in advance to permanently forgo examination of previously filed tax returns for a specific person or business.”
Press reports released in advance of the settlement indicated that a potential deal might include an agreement by the government to drop all audits of Trump-related returns and may even exempt the president from future audits.
Woodward defended the settlement with Trump and the creation of the Anti-Weaponisation Fund.
“I already have the authority to settle any claim that is brought against the United States of America,” Woodward told reporters. “I frankly think that we should be ecstatic about the idea that we’re going to inject more accountability into the process, as opposed to having just one person sign off on settlements.”
“I think that it’s way, way, way too early for us to rush to judgment on whether this was a good or a bad idea, to describe it as a slush fund, or really even to criticise it,” he added, without responding to reporters about Tuesday’s addendum ending all pending tax audits of the president and his companies. – AA