Republican senators secured a deal late Sunday that preserves immunity from IRS audits for President Trump and his family, while formally killing a controversial $1.8 billion “anti-weaponization fund” that had threatened to derail Todd Blanche’s confirmation as attorney general. Acting Attorney General Blanche issued a formal order on August 3, 2026, terminating the fund after weeks of negotiations with senators John Cornyn of Texas and Thom Tillis of North Carolina, who had blocked his nomination to the top Justice Department post.
The agreement clears the way for Blanche’s confirmation vote in the Senate Judiciary Committee on Tuesday, but leaves intact the core of Trump’s controversial IRS settlement. The deal clarifies that the tax audit immunity granted to Trump, his two sons, and his businesses applies retroactively only to returns filed before May 19, 2026—when the original settlement was announced—and does not shield the president from examination of future tax filings, according to Justice Department documents released Sunday.
The May 2026 settlement itself originated from Trump’s lawsuit against the IRS, filed in January after a contractor leaked his tax returns. Trump initially sought $10 billion in damages but agreed to drop the suit in exchange for the immunity deal and the anti-weaponization fund, which was intended to compensate individuals Trump believed had been unfairly prosecuted by prior administrations. The fund never distributed any money—no members were appointed, no funds transferred, and no claims were paid, according to the Justice Department order.
Cornyn and Tillis, both lame-duck senators facing political pressure from their party, had demanded the fund be abandoned in writing and the immunity terms narrowed. Trump initially resisted scaling back the deal, threatening to withdraw Blanche’s nomination and resubmit it after the senators left office. “But then when the president got wind of it, he wasn’t willing to go along with it,” Cornyn said Thursday, before the breakthrough Sunday evening.
The immunity agreement itself remains extraordinary by tax law standards. Tax lawyers say they know of no precedent for the IRS granting blanket immunity from audit across all of a taxpayer’s prior returns. “I have never seen anything like it,” said Steve Rosenthal, a former Tax Policy Center colleague and private law practitioner, according to tax reporting. Typically, IRS settlements foreclose future audits only for the disputed return itself, not for an entire filing history.
The immunity could shield Trump from audits of returns covering more than $2 billion in earnings Trump reported while president, including income from cryptocurrency businesses and thousands of stock trades, according to Trump’s financial disclosures. A federal judge, Kathleen Williams, voided the settlement in July, ruling that Trump’s lawsuit “was brought for an improper purpose—to gain the imprimatur of judicial legitimacy for a settlement that had no viable basis in law or fact.” Trump is appealing that ruling and the sanctions the judge imposed on his attorneys.
The revised deal does not resolve the core legal vulnerability: it is a federal crime for administration officials to interfere with IRS audits, and courts have consistently ruled the IRS is not liable for contractor actions like the tax-return leak that prompted Trump’s original suit. Whether Blanche’s unsigned social media post revising the settlement will bind a future IRS from auditing prior-year Trump returns remains legally uncertain, according to tax experts, who say a formal signed document from all parties would normally be required.
Sources
- PBS NewsHour — Details of Blanche’s formal order terminating the anti-weaponization fund, the senators’ demands, and the immunity terms applying retroactively to May 19, 2026
- Forbes — Tax law analysis of the immunity agreement’s unprecedented scope, the potential value to Trump (hundreds of millions to billions), and tax lawyer commentary on the deal’s lack of precedent
- New York Times — Blanche’s negotiations with Cornyn and Tillis, Trump’s resistance to scaling back the deal, and the judge’s July ruling voiding the settlement
