Trump’s $10 Billion IRS Shakedown Takes Darker Turn, Unnerving Experts

THE DAILY BLAST with Greg Sargent

The New Republic

News, Politics

4.4 • 798 Ratings

🗓️ 19 May 2026

⏱️ 17 minutes

🔗️ Recording | iTunes | RSS

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Summary

Donald Trump has reached a “settlement” with his Justice Department in a $10 billion lawsuit he brought against the IRS. Under it, DOJ will create a new $1.8 billion fund, controlled by Trump, that will dole out payments to allies who have supposedly been victimized by government “weaponization.” This could include the January 6 rioters. This has shocked legal observers, who called it everything from “horrible” to a “slush fund,” with others describing it as corruption that might be historically unprecedented. What happened here? Is there any recourse? Do Republicans really want to defend this, given that Trump’s economic numbers just cratered again in a brutal New York Times poll? We talked to legal expert Harry Litman, who writes for The New Republic and hosts the Talking Feds podcast. He explains why this is likely illegal but almost impossible to stop; why it’s so damaging to our system more broadly; and how Democrats can ensure that the GOP pays a major price for it this fall. Looking for More from the DSR Network? Click Here: https://linktr.ee/deepstateradio Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:21.8	com.uk slash podcast to learn more. This is the Daily Blast from the New Republic, produced and presented by the DSR Network.
0:40.4	I'm your host, Greg Sargent.
0:50.6	As you may have heard by now, the Justice Department just announced that it has reached
0:55.2	an agreement with Donald Trump to settle his $10 billion lawsuit against the IRS.
1:01.1	Guess who controls the Justice Department?
1:04.0	Donald Trump.
1:05.3	The settlement will transfer nearly $1.8 billion to a new fund that reportedly will be controlled by Donald Trump.
1:13.8	So, in short, Trump effectively ordered his own DOJ to reach an agreement with him
1:20.0	to transfer over a billion dollars in taxpayer funds into a new fund that he apparently
1:26.9	controls and can use to reward allies. How is this
1:31.3	possible? Is there any recourse? And also, isn't this going to backfire? A new poll shows Trump is
1:38.0	getting absolutely crushed on the economy, so good luck Republicans defending this new
1:42.9	arrangement.
1:51.5	We're working through all this with legal expert Harry Littman, who writes for the new republic and presides over the Talking Fed's podcast.
1:53.2	Harry, good to have you on.
1:55.2	Hey, good to be here, Greg. Thanks.
1:57.7	So let's quickly set the stage.
2:03.5	Back in January, Trump sued the IRS for $10 billion due to his tax returns getting leaked during his first term. Trump was in control of the IRS when that happened,
2:09.1	so the lawsuit is baloney. But let's put that aside for now. DOJ, which theoretically is supposed to be
2:16.6	defending the IRS against Trump's lawsuit,
2:19.9	now reached an agreement with Trump to settle the suit.
	...

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