Judge Voids Trump IRS Settlement Over Improper Self-Dealing

U.S. District Judge Kathleen M. Williams ruled on July 13, 2026, that Donald Trump filed a $10 billion lawsuit against the Internal Revenue Service (IRS) for an improper purpose. The judge characterized the litigation as an exercise in self-dealing designed to grant judicial legitimacy to a May 2026 settlement that provided Trump, his family, and his businesses immunity from tax audits.

Judge Williams nullified the settlement, which also established a $1.776 billion Anti-Weaponization Fund for political allies. She determined there was never a genuine legal controversy because Trump, as president, effectively controls the IRS and the Treasury Department, meaning the parties acted as a unitary interest. While the ruling prevents Trump and his administration from citing the agreement as a legitimate legal process in future proceedings, it did not explicitly void the tax protections themselves, though it may reopen the IRS's ability to audit past claims.

The judge heavily criticized the Department of Justice for abdicating its responsibility to the public interest. Acting Attorney General Todd Blanche, who negotiated the deal, previously announced the government would not proceed with the Anti-Weaponization Fund following political pressure and a separate Virginia court ruling.

As a result of the ruling, Judge Williams referred attorney Alejandro Brito to the Florida bar for disciplinary action and barred attorney Daniel Epstein from filing in the Southern District of Florida for one year. She also flagged ethical concerns regarding Todd Blanche and Associate Attorney General Stanley Woodward Jr., forwarding her findings to state bars in New York and the District of Columbia.