President Trump dismissed his $10 billion lawsuit against the IRS on Monday in exchange for a formal government apology and the creation of a $1.776 billion compensation fund open to any American who believes federal agencies were turned against them for political reasons, including, remarkably, Hunter Biden.
The settlement, reported by the New York Post, resolves a case Trump, his sons Don Jr. and Eric, and the Trump Organization filed on January 29 after the government failed to protect their confidential tax returns from being leaked to the New York Times in 2019. In its place now stands the Justice Department Anti-Weaponization Fund, a board-governed mechanism designed to hear claims, issue apologies, and distribute monetary relief to people who were unfairly targeted by any administration.
Acting Attorney General Todd Blanche announced the fund's formation Monday with a statement that left little ambiguity about the settlement's purpose.
"The machinery of government should never be weaponized against any American, and it is this Department's intention to make right the wrongs that were previously done while ensuring this never happens again."
Trump and his family receive no compensation from the fund. They get the apology. Everyone else, from January 6 defendants to political targets of prior administrations, gets a place in line.
Five board members, all appointed by Blanche, will oversee the Anti-Weaponization Fund. One of the five will be selected in consultation with House Speaker Mike Johnson and Senate Majority Leader John Thune. Blanche had not yet named his appointments as of the announcement.
The board can issue apologies, grant monetary relief, or request additional information from both claimants and relevant federal agencies. Approved claims will be subject to FOIA laws and federal audits and must be reported to the attorney general. The president retains the power to remove board members without cause.
The fund sunsets on December 15, 2028. Any money left over reverts to the federal government.
A senior administration official told the Post the fund is not designed to hand out windfalls. The goal, the official said, is restoration.
"The point of this isn't to make every January 6-er a millionaire. The point is to compensate, and to give entitled people back some of their dignity and some of what they lost, including money, whether it's for legal fees or other costs associated with what they went through."
The most politically charged detail in the settlement is its breadth. Hunter Biden, convicted of federal tax and gun charges, then pardoned by his father, former President Joe Biden, is eligible to apply. The former first son accumulated millions in legal fees during his prosecutions, and his reported debts and unpaid legal bills have been well documented.
A senior administration official acknowledged that a Hunter Biden application would not be surprising.
"I potentially expect it. Whether the commissioners will agree with that, and feel like he needs to be compensated, is something that, I think we'll have to see."
The official explained the administration's reasoning for not excluding Biden's son from eligibility. The fund was deliberately left open to anyone who believes the Justice Department was used as a weapon against them, regardless of which administration did the targeting.
"We didn't limit it in that way, because we really viewed it as, and actually this is what the president has said, which is that the Department of Justice was used as a weapon for reasons that are totally wrong, and if Hunter Biden believes that the Department of Justice was used as a weapon against him, he's allowed to apply."
That framing carries a certain irony. Hunter Biden publicly defended his own pardon while criticizing Trump's clemency record. Now the same administration he criticized is offering him a chance at compensation.
The lawsuit Trump settled grew out of a genuine breach. IRS contractor Chaz Littlejohn pleaded guilty to one count of unauthorized disclosure for leaking Trump's confidential tax returns. Littlejohn was sentenced to five years in prison in January 2024. He also leaked tax documents belonging to thousands of other wealthy Americans to ProPublica.
The Trumps filed their $10 billion suit charging the government failed to safeguard their records. The case was approaching a deadline this week at which the Justice Department would have needed to justify why it should proceed. Instead, the settlement replaced litigation with a broader remedial structure.
The leak itself was a clear-cut government failure. A contractor with access to some of the most sensitive financial records in the country walked out the door with them, and the public learned about it only after the damage was done. The five-year sentence Littlejohn received hardly matched the scale of the breach.
Meanwhile, the IRS whistleblowers who flagged political interference in Hunter Biden's tax investigation have their own story of government dysfunction. Gary Shapley and Joseph Ziegler reached an undisclosed settlement with the DOJ over alleged illegal retaliation tied to their disclosures about the Biden tax case.
Shapley and Ziegler said they came forward because Hunter Biden "almost escaped prosecution for his crimes because he was the President's son." They noted that Biden ultimately pleaded guilty, was pardoned, and then dropped his own lawsuit against the IRS that had targeted the whistleblowers themselves.
That chain of events, buried evidence, retaliation against truth-tellers, a presidential pardon, is precisely the kind of institutional rot the Anti-Weaponization Fund is meant to address.
The deal is not cost-free for the president. Monday's settlement requires Trump to withdraw claims related to the FBI's August 2022 raid on Mar-a-Lago and the FBI investigation into alleged collusion between his 2016 campaign and the Russian government. Those are two of the most politically significant episodes of his first term, and they are now off the table as legal claims.
A spokesman for Trump's legal team framed the trade-off in characteristically forward-looking terms.
"President Trump is entering into this settlement squarely for the benefit of the American people, and he will continue his fight to hold those who wrong America and Americans accountable."
Trump himself signaled this direction during his second inaugural address in January 2025, when he declared: "Never again will the immense power of the state be weaponized to persecute political opponents, something I know something about."
The administration pointed to a historical parallel for the fund's structure. In 2010, the Obama administration settled Keepseagle v. Vilsack by establishing a $680 million compensation fund and granting up to $80 million in farm loan debt forgiveness to Native American farmers who alleged discrimination by the USDA.
An administration official drew the comparison to explain why the board includes five commissioners with varied perspectives rather than a single decision-maker.
"The whole point of why we're doing this is because weaponization comes in many different forms, and having five commissioners, who kind of bring their own unique perspective to how to remedy it, was really our goal."
The comparison is instructive. Keepseagle addressed a specific class of victims and a specific agency. The Anti-Weaponization Fund is far broader, open to anyone who can make a case that any administration's Justice Department was turned against them. That scope is both its strength and its vulnerability. A narrow fund risks missing real victims. A broad one risks becoming a magnet for opportunists.
The details that remain unclear are significant. The exact process and deadline for filing claims have not been disclosed. Individual award amounts are unspecified. The text of the formal apology to the Trump family has not been released. And whether the withdrawal of Trump's Mar-a-Lago and Russia-investigation claims has already been filed in court remains an open question.
The broader pattern of suppression and political manipulation that led to this moment stretches back years. From leaked tax returns to retaliatory investigations to pardons that short-circuited accountability, the federal government's track record of even-handedness has taken real damage.
Whether $1.776 billion, a number that nods unmistakably to the founding year, is enough to restore public trust in institutions that abused it is an open question. Whether Hunter Biden will actually file a claim, and whether a board appointed by this administration will grant it, remains to be seen.
But the fund's existence forces a concession that Washington has spent years resisting: that the machinery of government was used against citizens for political purposes, and that someone owes them something for it.
The fact that a president had to sue the IRS to get an apology tells you everything about how far the rot went. The fact that he gave up his own claims to build a fund for everyone else tells you something about how to fix it.
