The United States Justice Department has granted President Donald Trump, his family and businesses immunity from ongoing inquiries into their taxes, a potentially lucrative arrangement that could shield the president from significant financial liability.
The provision, quietly disclosed on May 20 as a supplement to a remarkable deal that also created a US$1.8 billion compensation fund aimed at benefiting Mr Trump’s allies, protects the president, his relatives and his businesses from pending audits and tax prosecutions.
The one-page document, signed by the acting attorney general, Todd Blanche, said that the government would be “FOREVER BARRED and PRECLUDED from prosecuting or pursuing” pending tax claims against Trump, his family members and businesses.
The provision invited immediate criticism as tax experts raised the possibility that it was illegal.
The provision was the latest in a series of manoeuvers this week that blurred the all-but-vanished boundary between official department business and the private interests of a president intent on using his power to extract financial gain from the federal government for himself and his allies.
A day earlier, Trump agreed to drop his US$10 billion lawsuit against the Internal Revenue Service (IRS) in exchange for the establishment of a fund for people he believes were wronged by federal investigations or prosecutions.
Justice Department officials had in part defended the creation of the fund by pointing to the fact that Mr Trump and his family members would not be paid by it.
But protection from audit could be quite financially beneficial for Mr Trump, who has always said that there was no wrongdoing in his tax filings.
In 2024, The New York Times reported that a loss in an IRS audit could cost Mr Trump more than US$100 million.
Federal law prohibits the president, vice-president and other executive officers from instructing the IRS to start or stop specific audits. But that broad prohibition appears to include a carve-out for the attorney general.
Mr Brandon DeBot, a senior attorney adviser at New York University’s Tax Law Center, said in a statement that the audit protection may still be illegal.
“The IRS would need to act to make the release of claims effective, which could raise additional questions about whether there has been unlawful political interference in the audit process,” he said. “The settlement and general release of claims is a breathtaking abuse of the tax and legal system.” NYTIMES
