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Treasury Chief Says Taxpayers Would Fund Any Payout in Trump’s $10 Billion IRS Lawsuit

The pledge comes as the Justice Department, not Treasury, will represent the government in court.

The IRS headquarters building on Sept. 15, 2024, in Washington, D.C.
UNITED STATES - FEBRUARY 5: Treasury Secretary Scott Bessent testifies during the Senate Banking, Housing and Urban Affairs Committee hearing titled "The Financial Stability Oversight Council's Annual Report to Congress," in Dirksen building on Thursday, February 5, 2026. (Tom Williams/CQ-Roll Call, Inc via Getty Images)
U.S. Treasury Secretary Scott Bessent attends a Senate Banking, Housing and Urban Affairs Committee hearing on the Financial Stability Oversight Council's annual report to Congress, on Capitol Hill in Washington, D.C., U.S., February 5, 2026. REUTERS/Jonathan Ernst

Overview

  • At a Senate hearing, Treasury Secretary and acting IRS chief Scott Bessent confirmed any award or settlement would be paid from the Treasury general account, meaning taxpayer funds, and referenced roughly 44,000 taxpayers affected by related leaks.
  • President Donald Trump, his sons, and the Trump Organization sued the IRS and Treasury on January 29 in federal court, seeking at least $10 billion over tax-return disclosures carried out by former IRS contractor Charles Littlejohn, who pleaded guilty and received a five-year sentence.
  • Bessent said he has not discussed the lawsuit with the White House and deferred legal questions to the Department of Justice, which represents Treasury in the case.
  • In an NBC interview, Trump said he would donate 100% of any recovery to charity and suggested the matter is essentially won, though the lawsuit remains pending.
  • Legal analysts and Democratic lawmakers highlighted statute-of-limitations, damages, and conflict-of-interest hurdles, while Democrats launched oversight inquiries and proposed legislation to prevent a sitting president from personally profiting from such suits.