A US judge voided a legal agreement on Monday that had given Donald Trump immunity from tax audits, blowing up a settlement that also created a now-abandoned $1.8bn anti-weaponisation fund. US District Judge Kathleen Williams said the deal was filed for an improper purpose and should not stand.
The ruling lands now because it strips away a shield that had blocked scrutiny of Trump’s tax claims and could let the Internal Revenue Service move ahead with future audits. It also means Trump and his sons cannot cite the settlement terms in later legal fights, closing off one of the agreement’s most useful protections.
Williams said the case was never about a real legal dispute between Trump and the IRS. In her view, it was used to provide some legitimacy to an agreement that conferred immunity on people and entities affiliated with the President while earmarking billions of dollars from American taxpayers for grievances not defined in the law. She also referred one Trump lawyer, Alejandro Brito, to the Florida bar for possible disciplinary action, and said Daniel Epstein will be unable to join cases in the Southern District of Florida for at least a year.
The settlement had been reached after Trump dropped his personal $10bn lawsuit against the Internal Revenue Service. That suit said nothing had been done to stop the leak of private tax information by Charles Littlejohn, material that formed the basis of a New York Times investigation before the 2020 presidential election. The report said Trump paid only $750 in federal income taxes the year he won the presidency in 2016 and paid no taxes at all in 10 of the previous 15 years.
What made the arrangement so unstable was the gap between the legal posture and the politics around it. Williams said it was risible to suggest there had ever been true adverseness between the parties, while Trump’s legal team said the IRS wrongly allowed a rogue, politically motivated employee to leak private and confidential information to the media. A spokesman said President Trump continues to hold those who wrong America and Americans accountable.
Brandon DeBot, the tax law center policy director, called the settlement a sweetheart deal and said it gave Trump unauthorized and unprecedented exemptions from tax audit rules. With the agreement now voided, the immediate question is no longer whether the settlement protected Trump. It is whether the IRS will use the opening to press forward with audits that had been held at bay.
