Trump and sons demand $10 billion payout in new lawsuit against IRS 

President Donald Trump and his two eldest sons have sued the Internal Revenue Service (IRS), demanding that the agency hand over $10 billion of taxpayers’ money for the unauthorized leak of his tax returns during his first term.

The lawsuit, which was also filed against the Department of Treasury because it oversees the IRS, alleges that the two agencies failed to prevent a former contractor from accessing the president’s tax records and sharing them with the New York Times.

The unusual situation — a sitting president suing government agencies that are part of the executive branch, which he leads — raises the possibility that Trump’s own political appointees in the IRS and Treasury will get to decide how to respond to the suit.

The lawsuit would be unparalleled in U.S. history if Trump hadn’t already demanded that the Department of Justice (DOJ) give him $230 million in compensation for past federal investigations into him. He made the demand to the DOJ through an administrative claim, which is often the precursor to a formal lawsuit.

Both the administrative claim and the IRS lawsuit put the DOJ, which is led by Trump’s former personal attorneys, in the awkward position of having to defend the executive branch from the president in his personal capacity. Any payout to Trump in either lawsuit would effectively allow the president to pocket tax dollars paid by the American people.

Although the Trump Organization is headquartered in New York City, the Trumps filed their lawsuit against the IRS and Treasury in the Southern District of Florida, a jurisdiction with a reputation for being friendly to President Trump.

The suit was initially assigned to Judge Kathleen Williams, an appointee of former President Barack Obama.

Trump’s sons, Donald Trump Jr. and Erik Trump, were included in the lawsuit as executives of the Trump Organization, which is also a plaintiff.

In 2023, Charles Littlejohn, a former IRS contractor, pleaded guilty to illegally accessing and disclosing tax information that Trump had long refused to release publicly. 

Based on Littlejohn’s leaks, the New York Times published a series of stories before the 2020 election revealing Trump’s financial losses and his efforts to avoid taxes over several years.

By refusing to publicly share his tax records, Trump became the first president in modern U.S. history to hide basic details about his finances. 

However, Littlejohn’s actions were illegal, and he was later sentenced to five years in prison for the leak. He remains behind bars to this day.