Attorneys for President Donald Trump and the Internal Revenue Service told a federal court Friday that they’re in talks aimed at resolving a $10 billion lawsuit over leaked tax records tied to the president, his adult sons and his company.
In a joint filing, the parties requested a 90-day pause on proceedings in the case while they “engage in discussions designed to resolve this matter and to avoid protracted litigation.”
Trump sued the IRS and Treasury Department this year alleging the tax-collecting agency failed to take the necessary steps to prevent the unauthorized release of his tax documents by a government contractor who shared them with news outlets. The contractor, Charles Littlejohn, pleaded guilty and was sentenced in 2024 to five years in prison.
Littlejohn admitted in court that he also stole the tax records of thousands of other wealthy people in 2019 and 2020, including Jeff Bezos and Elon Musk.
The IRS in 2024 called Littlejohn's actions “unacceptable.”
The agency did not immediately respond to a request for comment Friday night on the status of the potential settlement talks with Trump's attorneys.
The lawsuit, which stated that Trump was suing in his personal capacity and not as president, also named two of Trump’s sons, Donald Trump Jr. and Eric Trump, and the Trump Organization as plaintiffs. The complaint alleged "reputational and financial harm" as well as "public embarrassment" from the leak, which led to The New York Times reporting that Trump had paid only $750 in federal income taxes in 2016 and 2017.
Democratic lawmakers this week introduced a bill that aims to ban the president, vice president and their families from collecting lawsuit settlement payments from the government.
One of the bill's sponsors, Sen. Elizabeth Warren, D-Mass., said the bill "will close the loopholes that enable this apparent corruption and ban Trump — and all future Presidents and Vice Presidents — from abusing their power and stealing Americans’ hard-earned money."
Trump has said that he would donate any received funds from the IRS lawsuit to charity, but that money would still come from U.S. taxpayers.
