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Trump drops $10bn lawsuit against IRS in exchange for a settlement fund

Trump drops $10bn lawsuit against IRS in exchange for a settlement fund

Summary

President Donald Trump has dropped a $10 billion lawsuit against the IRS over the leak of his tax returns. In exchange, the government will create a $1.7 billion fund to compensate people who say they were unfairly investigated.

Key Facts

  • President Trump sued the IRS in January for failing to stop a former contractor from leaking his tax returns.
  • The lawsuit was dropped shortly before a May 20 deadline to decide if the case was legally valid.
  • The settlement creates a $1.776 billion "anti-weaponisation fund" to pay and settle claims from people who faced unfair investigations.
  • A five-member commission will manage the fund, with four members appointed by the Attorney General.
  • President Trump and his supporters will not receive money from the fund but will get an apology.
  • Democrats criticized the fund as a misuse of taxpayer money, calling it a "slush fund."
  • The former IRS contractor, Charles "Chaz" Littlejohn, stole tax data and was sentenced to five years in prison.
  • The leaked tax returns revealed Trump paid very little federal income tax in previous years.
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