President Trump has dropped his $10 billion lawsuit against the Internal Revenue Service (IRS), which alleged the agency failed to protect Trump and the Trump Organization from an unauthorized leak of their tax returns. The dropped lawsuit comes amid the Justice Department announcing the creation of a $1.776 billion “Anti-Weaponization Fund.” The Justice Department said the fund was part of a settlement agreement in President Donald J. Trump v. Internal Revenue Service. “Per the settlement, plaintiffs will receive a formal apology but no monetary payment or damages of any kind. There are no partisan requirements to file a claim. Any money left when the Fund ceases operations will revert to the Federal Government,” the Justice Department said. “There is legal precedent for such a Fund, most notably the ‘Keepseagle’ case where the Obama Administration created a $760 million fund to redress various claims alleging racism against the federal government over a period of decades,” it added. Justice Department Announces Anti-Weaponization Fund: Part of settlement agreement in President Donald J. Trump v. Internal Revenue Service Per the settlement, plaintiffs will receive a formal apology but no monetary payment or damages of any kind. There are no partisan… — U.S. Department of Justice (@TheJusticeDept) May 18, 2026 ABC News explained further: The commission overseeing the compensation fund would have the total authority to hand out approximately $1.7 billion in taxpayer funds to settle claims brought by anyone who alleges they were harmed by the Biden administration’s “weaponization” of the legal system, including the nearly 1,600 individuals charged in connection with the Jan. 6 Capitol attack as well as potentially entities associated with President Trump himself. While the settlement is expected to be agreed upon in the coming days, sources caution that the final terms will not be set until they are officially announced. In addition to a public apology from the IRS, the compensation fund is believed to be the main condition for Trump to drop a series of legal actions he filed against the federal government, including the $10 billion lawsuit related to the 2019 leak of his tax returns as well as $230 million in legal claims related to the 2022 search of his Mar-a-Lago estate and the Russia collusion investigation he faced during his first term in office, sources familiar with the ongoing deliberations said. The settlement terms are expected to prohibit Trump from directly receiving payments related to those three legal claims; however, entities associated with Trump are not explicitly barred from filing additional claims, sources said. “The machinery of government should never be weaponized against any American, and it is this Department’s intention to make right the wrongs that were previously done while ensuring this never happens again,” said Acting Attorney General Todd Blanche. “As part of this settlement, we are setting up a lawful process for victims of lawfare and weaponization to be heard and seek redress,” he added. “The use of government power to target individuals or entities for improper and unlawful political, personal, or ideological reasons should not be tolerated by any Administration,” said Principal Associate Deputy Attorney General Trent McCotter. “The IRS wrongly allowed a rogue, politically-motivated employee to leak private and confidential information about President Trump, his family, and the Trump Organization to the New York Times, ProPublica and other left-wing news outlets, which was then illegally released to millions of people. President Trump continues to hold those who wrong America and Americans accountable,” a spokesperson for Trump’s legal team told ABC News. House Democrats criticized the fund, urging a judge to block the resolution. Democrats: DOJ’s $1.776B ‘anti-weaponization’ fund ‘raises the specter of corruption unparalleled’https://t.co/gLG82SF4tx — The Hill (@thehill) May 18, 2026 More from the Associated Press: Nearly 100 Democrats in the House of Representatives signed onto a legal brief urging a judge to block what they described as an unprecedented resolution that they said would unjustly enrich people close to the president with taxpayer dollars and open the door to meritless claims of political persecution. “This is one of the single most corrupt acts in American history,” Donald Sherman, the president of Citizens for Responsibility and Ethics in Washington, said in a statement. The fund would represent not only a highly unorthodox resolution but also a further demonstration of the administration’s eagerness to reward allies of Trump who have long insisted that they have been unjustly investigated and in some cases charged and convicted. Most notably, the president on his first day back in office pardoned or commuted the sentences of supporters who rioted at the U.S. Capitol on Jan. 6, 2021. His Justice Department since then has approved payouts to supporters entangled in the Trump-Russia investigation and investigated and prosecuted some of his perceived adversaries. Trump’s attorneys suggested in their court filing seeking to dismiss the case that the resolution would not be reviewable by a judge. But a group of 93 members of Congress filed a brief teeing up a challenge. “This case is nothing but a racket designed to take $1.7 billion of taxpayer dollars out of the Treasury and pour it into a huge slush fund for Trump at DOJ to hand out to his private militia of insurrectionists, rioters, and white supremacists, including those who brutally beat police officers on January 6, 2021, and sycophant accomplices to his election stealing schemes,” Rep. Jamie Raskin, the top Democrat on the House Judiciary Committee, said in a statement.