RESOLVING THE LEDGER
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President Donald Trump listens to questions from reporters during a Cabinet meeting at Camp David, the presidential retreat, in Camp David, Maryland, on July 31, 2026. —Anna Moneymaker—Getty Images
While Acting Attorney General Todd Blanche has formally rescinded the controversial “ Anti-Weaponization Fund ” the Justice Department planned to create under a settlement agreement with President Donald Trump, another element of that agreement remains intact—and could shield Trump from paying as much as $100 million in back taxes and penalties.
The President tapped Blanche, his former personal attorney and the former deputy attorney general, to lead the Justice Department after Pam Bondi was removed from the position in April. But Blanche’s confirmation was upended last week when two Republican senators threatened to pull their support. The holdouts, Sens. John Cornyn of Texas and Thom Tillis of North Carolina, said that they wanted assurance from the Justice Department that the proposed $1.8 billion “Anti-Weaponization Fund,” which was intended to compensate people the Trump Administration believed to have been unfairly targeted by the government, has been abandoned.
On Monday, the senators announced that they would back Blanche’s nomination after the Justice Department confirmed, in writing, that it was rescinding the proposed fund.
Read More: Who Is Todd Blanche, Trump’s Former Lawyer and Nominee for Attorney General?
But a tax audit immunity deal that was included in the same settlement agreement and has raised its own concerns from lawmakers and experts will remain in place.
Here’s what to know about that deal, and what it could mean for the President.
What are the terms of the tax audit immunity deal?
The Justice Department outlined the immunity deal in a document dated May 19, saying that it shielded Trump, his sons, and the Trump Organization from audits related to tax returns filed before that date.
The agreement that the deal was a part of settled a $10 billion lawsuit Trump, his sons, and the Trump Organization filed against the IRS and the Treasury Department in January over the leak of his tax returns to news outlets by a former contractor years earlier.
Cornyn and Tillis said this week that in addition to confirming that the “Anti-Weaponization Fund” was being rescinded, Blanche and the Justice Department addressed concerns they had with the audit deal, including clarifying that the scope of the protection was limited to the parties in the initial lawsuit.
Blanche shared a document on X Sunday night in which he confirmed that the audit deal only applies to the parties named in the lawsuit. He also reiterated that the immunity plan “applies by its terms only retroactively.” That means that under the deal, while Trump, his sons, and the Trump Organization could avoid audits of previously filed returns, they could still face audits of tax returns they file in the future.
The NYU Tax Law Center said in a statement on Monday that the new document shared by Blanche this week “does nothing to change” the original deal.
“These assurances are not worth the paper they’re written on,” NYU Tax Law Center Policy Director Brandon DeBot said in a statement. “They don’t pull back on the ongoing attempts to give the President, his family, and his affiliates unauthorized immunity from tax audits.”
What does the agreement mean for Trump?
“It basically means that if [Trump] underpaid taxes or made misleading statements in his returns prior to the day of the deal, he gets a free pass,” David Super, a professor at Georgetown Law, tells TIME.
The amount in back taxes and penalties that the President may be able to avoid paying under the immunity deal is not clear, since audits conducted by the IRS are typically confidential information. But a 2024 report from the New York Times and ProPublica revealed that Trump could owe more than $100 million if a lengthy dispute related to an IRS audit over tax breaks that Trump claimed on his skyscraper in Chicago resulted in an adverse ruling. In May, the Times reported that it wasn’t known if that audit is still ongoing.
Super says that the tax audit immunity deal is unprecedented and “completely self-dealing.” In the past, the IRS has regularly audited the sitting President “so that there would never be any question that they got preferential treatment,” he says.
He contends that “it is not … [a] deal that anyone has considered and decided was in the best interests of the United States government; it’s simply in his and his family’s best interest, and he has the power to force the Justice Department to accept that.”
“In that respect,” Super says, “it is unlike anything we’ve seen before.”
Last month, a federal judge ruled that Trump’s lawsuit was an exercise in self-dealing. While she didn’t explicitly overturn the tax audit deal conferred on Trump, the judge said that the deal can’t be claimed to be a product of a legitimate legal process. The President has filed an appeal.
The NYU Tax Law Center also questioned in its Monday statement whether Blanche has the legal authority to end tax audits of Trump, his sons, and the Trump Organization in this litigation.
Blanche “only has authority to resolve tax matters that have been referred to DOJ—here, a taxpayer privacy lawsuit, not issues with tax returns,” the Tax Law Center contended. “Likewise, to the extent that the new documents purport to maintain the May 19, 2026 order’s audit immunity for the Trump plaintiffs, that is also unauthorized."
In a statement to TIME, the Justice Department said that Blanche "restated and incorporated testimony he gave under oath that the May 19th Order has effect only on plaintiffs and defendants, and that the release is retroactive only."
The White House, IRS, and Treasury Department did not immediately respond to a request for comment
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