Administration Proposes $1.776 Billion Commission, Named for President, to Resolve President's Lawsuit Against President's Own Agency

The Trump administration is in advanced discussions to settle a $10 billion personal lawsuit filed by the president against the Internal Revenue Service, with a proposed resolution that includes establishing a nearly $1.776 billion federal compensation fund and requiring the IRS to drop ongoing audits of the president, his sons Donald Trump Jr. and Eric Trump, and the Trump Organization's business holdings, according to two sources familiar with the negotiations.

The talks, which involve officials at the Department of Justice, the IRS, and the White House, center on a complaint that a former government contractor improperly provided the president's confidential tax returns to journalists during his first administration. Charles Littlejohn, who worked for consulting firm Booz Allen Hamilton and had contractor access to IRS systems, pleaded guilty to the unauthorized disclosure and was sentenced to five years in federal prison in January 2024. An announcement on the settlement could come as soon as this week.

The proposed fund is expected to be named "The President Donald J. Trump Truth and Justice Commission." The $1.776 billion figure is not arrived at through standard actuarial methodology. One source described it as a deliberate reference to the year of the country's founding, timed to coincide with the approaching America 250 celebration. The commission would compensate individuals who believe they were subjected to politically motivated federal investigations under previous administrations, with at least two sources suggesting eligibility could extend beyond the Biden years to cover, as one source put it, "anyone unfairly investigated under any administration."

Settlement terms are structured to prevent any direct payment to the president personally, a provision officials described as an effort to avoid the ethical complications that would arise from the president of the United States receiving a check from the Justice Department he oversees, in resolution of a lawsuit he filed against a revenue agency his administration controls, adjudicated in a federal court system whose senior appointments he has made. The White House declined to comment on the ethical complications. DOJ and IRS did not respond to requests for comment.

The scope question has drawn quiet attention among legal observers. "Any administration" is a notably broad aperture for a fund whose origin story is a specific 2024 leak conviction for which a sentence has already been served. Analysts reached by this correspondent declined to comment on the record. One, who asked not to be named, said only that the framing presented some interesting modeling challenges from a liability standpoint, and then asked to move on.