In a significant legal escalation that places a sitting president at odds with his own administration, Donald Trump filed a $10 billion lawsuit against the Internal Revenue Service (IRS) and the U.S. Treasury Department on Thursday, January 29, 2026.
The lawsuit, filed in a Miami federal court, alleges that the agencies failed to safeguard his confidential tax records, allowing a former contractor to leak them to the press during his first term.
1. The Core Allegations: “Gross Negligence”
The 27-page complaint argues that the IRS and Treasury Department committed a “catastrophic breach of privacy” by failing to implement mandatory precautions.
- Plaintiffs: Donald Trump (suing in his personal capacity), Donald Trump Jr., Eric Trump, and the Trump Organization.
- The “Littlejohn” Connection: The suit centers on the actions of Charles Littlejohn, a former IRS contractor for Booz Allen Hamilton. In 2024, Littlejohn was sentenced to five years in prison for leaking the tax returns of Trump and thousands of other wealthy Americans to The New York Times and ProPublica.
- Security Failures: Trump’s legal team alleges that it took the IRS three years to detect the breach, which they claim constitutes willful misconduct and gross negligence.
2. The $10 Billion Damages Breakdown
The eye-popping $10 billion figure is calculated based on the scale and frequency of the unauthorized disclosures.
| Damage Type | Justification |
| Statutory Damages | Seeking $1,000 for each unauthorized disclosure across media and social platforms. |
| Reputational Harm | Compensation for “public embarrassment” and “falsely tarnishing” the Trump family brand. |
| Financial Impact | Alleged negative effects on the Trump Organization’s business standing and public image. |
| Punitive Damages | Aimed at deterring future governmental negligence regarding taxpayer data. |
3. A Pattern of Multi-Billion Dollar Litigation
This lawsuit is the latest in a series of massive legal claims filed by Trump since his 2025 inauguration.
- BBC Defamation ($10B): Filed in December 2025 over the allegedly misleading editing of his January 6 speech.
- New York Times ($15B): A defamation suit regarding the newspaper’s coverage of his 2024 campaign.
- Wall Street Journal ($10B): Regarding reporting on an alleged drawing sent to Jeffrey Epstein.
- JPMorgan Chase ($5B): Claiming the bank closed his accounts for political reasons.
4. The “Conflict of Interest” Question
The lawsuit presents a unique legal and ethical dilemma: A sitting president is suing the very departments he oversees.
- The Negotiating Table: As President, Trump ultimately oversees the Justice Department, which would typically defend the IRS and Treasury. Critics and legal experts have noted the “oddity” of the President potentially negotiating a settlement with himself.
- Contract Cancellation: Days before the filing, the Treasury Department canceled $21 million in contracts with Booz Allen Hamilton, citing the firm’s failure to prevent the Littlejohn leaks.
Conclusion: A Strategic Legal Offensive
While legal experts suggest Trump faces a high threshold to prove “actual malice” or systemic negligence, the $10 billion lawsuit serves a dual purpose. Beyond the potential payout, it amplifies his long-standing narrative that federal agencies have been “weaponized” against him. As the 2026 midterms approach, this case is likely to become a central pillar of his administration’s focus on “dismantling the deep state” and enforcing government accountability.
