President Trump dropped his $10 billion lawsuit against the IRS on Monday after the Justice Department agreed to issue a formal apology and create a $1.776 billion fund open to any American who believes the federal government unfairly targeted them, including, remarkably, Hunter Biden.
The settlement, reported by the New York Post, resolves a case the Trumps filed on January 29 charging the government with failing to protect confidential tax returns that were leaked to the New York Times in 2019. In exchange for dismissing the suit, Trump secured something no dollar figure could buy on its own: a formal government admission that the machinery of federal power was turned against American citizens for political reasons.
Neither Trump, his sons Don Jr. and Eric, nor the Trump Organization will receive a dime from the new fund. The apology is their settlement. The money goes to everyone else.
Acting Attorney General Todd Blanche announced the Justice Department Anti-Weaponization Fund on Monday with a statement that left little room for ambiguity about the government's posture.
"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."
The fund's structure is straightforward. Blanche will appoint five board members, with one picked in consultation with House Speaker Mike Johnson and Senate Majority Leader John Thune. The president retains the power to remove board members without cause.
Applicants who believe they were unfairly targeted by any administration, not just the Biden or Obama years, can submit claims. The board can issue apologies, grant monetary relief, or request more information from claimants and relevant agencies. All approved claims will be subject to FOIA laws and federal audits, and must be reported to the attorney general.
The fund sunsets on December 15, 2028. Any remaining money reverts to the federal government.
One of the most immediate questions is whether people charged in connection with the January 6, 2021, Capitol riot will flood the fund with applications. A senior administration official addressed that directly.
"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."
That framing matters. The fund is not a blanket payout mechanism. It is a claims-based process with a five-member board, federal audit requirements, and FOIA exposure. Whether it remains disciplined or becomes a magnet for marginal grievances will depend entirely on the commissioners Blanche selects and the standards they enforce.
The settlement also requires Trump to withdraw claims related to two separate FBI matters: the August 2022 raid on Mar-a-Lago and the bureau's investigation into purported collusion between Trump's 2016 campaign and the Russian government. That withdrawal narrows the president's personal legal exposure while broadening the fund's reach to the general public, a trade that favors the principle over the plaintiff.
Trump himself signaled this priority as far back as his second inaugural address, when he declared: "Never again will the immense power of the state be weaponized to persecute political opponents, something I know something about." His family has lived through multiple high-profile prosecutions that millions of Americans viewed as politically motivated.
Perhaps the most striking detail in the settlement is that Hunter Biden, convicted of federal tax and gun charges before being pardoned by his own father, is eligible to apply. A senior administration official said the door was left open deliberately.
"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."
Whether the board would actually award him anything is another matter. The same official said of a potential Hunter Biden application: "I potentially expect it," but added, "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."
Hunter Biden has accumulated millions in legal fees. He now lives abroad and claims $17 million in debt, with a former law firm suing him over unpaid bills. Whether he has the standing, or the nerve, to petition a Trump-created fund for relief would be one of the more audacious moves in modern political history.
The fact that the administration left the door open tells you something about the fund's design philosophy. This is not a partisan slush fund. It is structured as a principle-based mechanism, and the principle is that government power should not be used to target citizens for political reasons, regardless of which party they belong to.
A spokesman for Trump's legal team reinforced that framing: "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."
The lawsuit traces back to a genuine scandal that received far less media outrage than it deserved. In 2019, Trump's confidential tax returns were leaked to the New York Times. IRS contractor Chaz Littlejohn later pleaded guilty to one count of unauthorized disclosure. He was sentenced to five years in prison in January 2024.
Littlejohn's misconduct went well beyond one taxpayer. He also leaked tax documents of thousands of other wealthy Americans to ProPublica. The broader pattern of government officials selectively leaking sensitive information for political purposes has been a recurring theme of the last decade, and one that rarely results in meaningful consequences for the institutions that allowed it to happen.
The Trumps filed their $10 billion suit charging the government with failing to protect their confidential records. Trump and the Justice Department faced a deadline this week to justify why the case should proceed. Instead, they settled.
The fund's structure is not without precedent. The Obama administration settled Keepseagle v. Vilsack in 2010 by establishing a $680 million compensation fund and granting up to $80 million in farm loan debt forgiveness for Native American farmers who had been discriminated against by the USDA. That settlement created a model for using a government-funded claims process to address systemic mistreatment by federal agencies.
The Anti-Weaponization Fund is roughly two and a half times the size of the Keepseagle fund. Its scope is also far broader, covering not just one agency's conduct toward one group, but the full range of federal law enforcement and regulatory action that applicants believe was politically motivated.
An administration official explained the rationale for the five-member board structure rather than a single administrator.
"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."
Blanche had not yet decided on his appointments as of the announcement. The identities of those commissioners will matter enormously. They will decide who gets compensated, how much, and on what evidentiary basis, questions the settlement terms leave largely to the board's discretion.
Several important details remain unclear. The exact legal mechanism creating the fund has not been publicly detailed beyond the settlement announcement. The application standards and evidentiary requirements claimants must meet have not been specified. And the identity of the sixth board member, the one selected in consultation with congressional leaders, has not been disclosed.
The December 2028 sunset date means the fund has roughly two and a half years to process claims before remaining money reverts to the federal treasury. That is a tight window for what could be a flood of applications. Whether politically connected figures receive priority treatment or whether ordinary Americans who were ground up by federal overreach get their day will be the true test of the fund's integrity.
Trump walked away from a $10 billion claim and took an apology instead. The $1.776 billion, a number that nods to the founding year, goes to the people the government wronged. Critics will call it a payoff. Defenders will call it accountability. The difference depends on whether you believe the government owes something to the citizens it turned its power against, or whether you think that power was used fairly all along.
For millions of Americans who watched federal agencies leak tax returns, raid a former president's home, and prosecute political opponents with selective zeal, the answer is not complicated. The only question is whether $1.776 billion is enough.