US President Donald Trump is moving to voluntarily drop a $10 billion lawsuit against the Internal Revenue Service (IRS) that legal experts had called "unprecedented," according to a court filing on Monday.
According to a Miami federal court filing, Trump, his two oldest sons, and the Trump Organization withdrew their $10 billion lawsuit against the Internal Revenue Service on Monday.
The $10 billion lawsuit, which was filed in January 2026, claimed that the IRS had neglected to protect private tax information. During Trump's first term as president, former IRS contractor Charles Littlejohn leaked Trump's tax returns to ProPublica and The New York Times.
The filing from Trump's attorneys did not explain the unexpected action, but it implied that it effectively prevented a judge from determining the legality of the president's civil claim and from dismissing it if she did.
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The departure followed uproar around claims that the Department of Justice was discussing a settlement with the president that may see the federal government contribute $1.7 billion to a fund to reward Trump friends who claim the Biden administration mistreated them.
Congressmen who are Democrats claimed that it would be a "slush fund."
CNBC has questioned the DOJ about whether Trump's withdrawal of the lawsuit is related to the government's out-of-court settlement of his allegations.
Trump, Donald Trump Jr., Eric Trump, and the Trump Organization voluntarily dismissed the lawsuit against the IRS "with prejudice," according to a court filing on Monday.
Prejudice prevents the plaintiffs from bringing the identical allegations in a different civil lawsuit.
Judge Kathleen Williams of the U.S. District Court had given the DOJ and Trump's lawyers two days to respond to the notice of dismissal over whether a "case and controversy exists in this matter to establish the Court's jurisdiction."
Williams' inquiry implied that there could not be sufficient real hostility between the parties to meet a constitutional requirement that federal courts only decide cases or disputes because Trump is suing "entities whose decisions are subject to his direction."
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According to the Monday filing, Trump's dismissal implies that "no judicial analysis is appropriate, and any subsequent order purporting to dismiss 'all claims' . . . [would be] a nullity."
In late January, Trump filed a lawsuit against the IRS due to Charles "Chaz" Littlejohn, an IRS employee, disclosing his tax information in 2019 and 2020.
The firing was not immediately addressed by a representative for Trump's legal team.
A request for comment was not immediately answered by the IRS.
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