Addendum to Trump-IRS settlement shields US President, family from any future tax audits

On Tuesday, the US Department of Justice quietly published a waiver barring the Internal Revenue Service from prosecuting Trump & his family. A day earlier, Trump dropped a $10bn lawsuit against the IRS.

US President Donald Trump speaks with the media at the White House in Washington, D.C. | File Photo: Reuters

New Delhi: The United States Department of Justice (DoJ) expanded a deal between Donald Trump and the Internal Revenue Service (IRS) Tuesday, permanently barring the US agency from investigating or prosecuting Trump, his family, or their businesses over past tax affairs.

The addendum to the recent Trump-IRS settlement agreement was quietly published Tuesday without a formal statement from the DoJ. It effectively shields the US President and his family from IRS audits related to their tax filings before the settlement’s effective date.

“The United States RELEASES, WAIVES, ACQUITS, and FOREVER DISCHARGES each of the Plaintiffs from, and is hereby FOREVER BARRED and PRECLUDED from prosecuting or pursuing, any and all claims, counterclaims, causes of action, appeals, or requests for any relief, including injunctive relief, monetary relief, damages, examinations or similar or related reviews, appeals, debt relief, costs, attorney’s fees, expenses, and/or interest, whether presently known or unknown, that—as of the Effective Date of the Settlement Agreement (sic),” the one-page addendum said. It was signed by Acting Attorney General Todd Blanche, Trump’s personal attorney before he was brought into the DoJ during the President’s second tenure.

A day before, Trump agreed to drop a $10 billion lawsuit against the IRS in exchange for establishing a $1.776 billion “settlement fund” for individuals the President believes the US government unfairly prosecuted. The “anti-weaponisation fund”—announced by the DoJ Monday—will have five members, receive $1.776 billion from the “judgment fund”, and function as a “perpetual appropriation” allowing the DoJ to settle and pay any claims.

“At the Attorney General’s direction, the Fund can be audited. The Fund must take steps to protect private information and avoid fraud. The Fund shall cease processing claims no later than December 1, 2028 (sic),” the readout provided by the DoJ said.

The original settlement agreement and the addendum highlight the Trump administration’s efforts to shield the President while the Republican Party maintains tight control over the White House and the US Congress.

However, these have found little support among the Democratic Party and Trump’s critics, who accuse the American President of “self-dealing”.

“The DOJ just said the IRS will no longer pursue any claims it may have against Trump, his family members, and his companies over unpaid taxes. Pure. Unadulterated. Corruption. And self-dealing,” Adam Schiff, the Democratic Senator from California, said in a statement on X Tuesday. “The tax-dodging President gets himself and his whole family a tax break, thanks to Todd Blanche.”

Democratic Senator Schiff has been one of Trump’s biggest opponents in the US Congress.

Schiff was the lead manager during Trump’s first impeachment trial over his ties to Ukraine. While the House of Representatives voted to impeach the President, the Senate acquitted him. Trump faced impeachment by the House of Representatives twice during his first tenure.

The US President and senior officials cannot direct the IRS regarding its audits. However, a loophole exists in the broad language that excludes the Attorney General from the existing statutes on directing the IRS on its investigations.

(Edited by Madhurita Goswami)