Democrats blast Trump over 'slush fund' in possible IRS lawsuit settlement

U.S. President Donald Trump speaks in front of the American flag to the press as he departs the White House on May 12, 2026 in Washington, DC. Kevin Dietsch | Democratic lawmakers on Friday slammed the Trump administration over reports that President Donald Trump would drop his $10 billion lawsuit against the Internal Revenue Service in an exchange for what some called a $1.7 billion "slush fund." "This administration is dripping with corruption from top to bottom, but rushing a settlement to steal $1.7 billion taxpayer dollars for a slush fund before a judge can toss your junk lawsuit would be among the most corrupt acts in American political history," Sen. Ron Wyden , D-Ore., the top Democrat on the Senate Finance Committee. "This lawsuit has never been anything more than a shakedown of the American people by a crook president and his crook lawyers," Wyden said. Trump, his two eldest sons, and his family business sued the IRS and the Treasury Department over the 2019 leak of the president's tax returns . It was an unprecedented move that raised concerns about conflicts of interest at the time.