US justice department reaches controversial settlement blocking Trump tax audits

The US justice department has agreed to a settlement with former president Donald Trump that permanently blocks tax authorities from auditing his past tax returns, sparking accusations of corruption and self-dealing, Dagbladet reports.

The deal also shields Trump’s business empire, the Trump Organization, as well as his sons Eric Trump and Donald Trump Jr. from future scrutiny of their prior filings. Critics, including former IRS officials and Democratic lawmakers, have condemned the arrangement as unprecedented and a potential misuse of power.

‘Grotesque’ self-enrichment

Under the agreement, a new $1.8 billion “Anti-Weaponization Fund” will be established to compensate individuals claiming to have faced politically motivated abuse by the government. Opponents warn the fund could disproportionately benefit Trump allies.

Democratic Representative Richard Neal, a senior member of the House Ways and Means Committee, called the settlement “pure corruption.”

“Exempting the Trump family from audits while funneling $1.8 billion to friends, allies, and Trump-affiliated circles is self-dealing at its most grotesque,” Neal told NBC News. “This is a dark, dark day for our democracy.”

Unprecedented move

Former IRS commissioners John Koskinen (2013–2017) and Danny Werfel (2023–2025) both described the deal as without precedent. Werfel stated he had “never heard of a case where the IRS permanently waived its right to audit past returns for a specific individual or entity.”

The watchdog group Citizens for Responsibility and Ethics in Washington labeled the agreement “the most blatant form of self-enrichment in presidential history.”

Justice department defends deal

In a statement, the justice department argued that settlements often involve both parties relinquishing potential future claims. The agreement stems from Trump’s 2020 lawsuit against the IRS, in which he sought $10 billion in damages after his tax documents were leaked to media outlets.

Trump had broken with longstanding tradition by refusing to release his tax returns during the 2016 election campaign.