Trump Sues IRS for $10B Over Tax Leaks

President Donald Trump, his two eldest sons and his family business sued the Internal Revenue Service and the U.S. Treasury Department over alleged leaks of their confidential tax information, court records showed Thursday.

The plaintiffs seek at least $10 billion in damages, according to the lawsuit in Miami federal court.

The case has been assigned to Judge Kathleen Williams, who was appointed to the U.S. district court bench by former President Barack Obama.

In August, Williams issued a temporary injunction that halted further expansion of the federal government’s Florida immigrant detention facility known as “Alligator Alcatraz,” effectively shutting it down. A federal appeals court later blocked Williams’ ruling.

The civil complaint filed Thursday alleges that the IRS and Treasury failed in their obligation to prevent the leak of those tax records by former IRS employee Charles “Chaz” Littlejohn in 2019 and 2020.

In addition to Trump, the plaintiffs are his sons, Donald Trump Jr. and Eric Trump, and the Trump Organization, which the sons run.

A spokesman for Trump’s legal team told CNBC in a statement, “The IRS wrongly allowed a rogue, politically-motivated employee to leak private and confidential information about President Trump, his family, and the Trump Organization to the New York Times, ProPublica and other left-wing news outlets, which was then illegally released to millions of people.”

“President Trump continues to hold those who wrong America and Americans accountable,” the spokesman said.

The suit was filed three days after Treasury Secretary Scott Bessent said he had canceled all of his department’s contracts with the consulting firm Booz Allen Hamilton in connection with the company’s contractor, Littlejohn, stealing and leaking confidential tax returns.

Littlejohn, 40, is serving a five-year prison sentence after having pleaded guilty in October 2023 to one count of disclosure of tax return information.

He admitted to leaking Trump’s tax records to The New York Times, and also admitted to leaking records about wealthy individuals to the investigative news outlet ProPublica.

The new lawsuit says that Littlejohn, in a 2024 deposition, admitted disclosing “Trump information [that] included all businesses that he had owned” to ProPublica.

The suit asserts that ProPublica’s subsequent reporting on Trump’s tax documents falsely claimed that the records contained “versions of fraud.”

While that quote does appear in ProPublica’s October 2019 report, it comes from Nancy Wallace, a finance and real estate professor at the University of California, Berkeley’s Haas School of Business.

Wallace was one of a dozen real estate professionals interviewed by ProPublica who said they saw no clear explanation for “multiple inconsistencies in the documents,” according to the report.

“Defendants have caused Plaintiffs reputational and financial harm, public embarrassment, unfairly tarnished their business reputations, portrayed them in a false light, and negatively affected President Trump, and the other Plaintiffs’ public standing,” the lawsuit says.

It’s all but unheard of for a sitting president to sue their own administration, and the exorbitant damages figure being demanded raises various conflict-of-interest questions.

But Trump has reportedly made similar moves in the recent past: The New York Times reported in October that Trump sought $230 million from the Department of Justice as compensation for its past investigations into him.