Donald Trump and the Internal Revenue Service are negotiating a settlement to end a $10 billion lawsuit over the unauthorized disclosure of the president's tax documents, according to a joint court filing Friday.
Both sides requested a 90-day delay in legal proceedings while they pursue what they described as "discussions designed to resolve this matter and to avoid protracted litigation."
The lawsuit centers on the leak of tax records belonging to Trump, his adult sons, and the Trump Organization. A government contractor named Charles Littlejohn stole the documents and shared them with news outlets in what became a major news story. The New York Times reported that Trump paid only $750 in federal income taxes in 2016 and 2017.
Littlejohn pleaded guilty to the theft and was sentenced to five years in prison in 2024. He admitted to stealing tax records from thousands of other wealthy individuals during 2019 and 2020, including Jeff Bezos and Elon Musk.
Trump filed the case this year alleging that the IRS failed to prevent the breach. The lawsuit named Trump Jr., Eric Trump, and the Trump Organization as additional plaintiffs and claimed damages including reputational and financial harm and public embarrassment.
Trump has pledged to donate any settlement money to charity, though such funds would ultimately come from U.S. taxpayers.
The settlement talks arrive as Democratic lawmakers introduced legislation this week to block the president, vice president, and their families from receiving payments from government lawsuits. Senator Elizabeth Warren of Massachusetts, one of the bill's sponsors, said the measure would "close the loopholes that enable this apparent corruption and ban Trump, and all future Presidents and Vice Presidents, from abusing their power and stealing Americans' hard-earned money."
The IRS called Littlejohn's actions "unacceptable" in 2024 but did not respond to requests for comment on Friday night regarding the settlement discussions.
Author Sarah Mitchell: "Settling quietly before a judge forces testimony about security lapses is smart lawyering, but voters deserve to know what really went wrong inside the IRS."
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