A sitting president is demanding that U.S. taxpayers more than double the net worth of a billionaire (himself) because a federal employee leaked old tax returns… that were “fake?”

The president is now asking American taxpayers to pay him billions for the exposure of tax returns he says don’t reflect reality. It’s a logical impossibility dressed up as a legal claim.

On Jan. 29, President Donald Trump filed a $10 billion lawsuit against the IRS and Treasury Department — his own executive branch agencies — over leaked tax returns. The legal claim immediately exposes a glaring contradiction: Trump is now defending as confidential the exact same documents he dismissed as “totally fake news” and “fabricated” back in 2020.

The Leak That Started It All

The story begins with Charles Edward Littlejohn, a former IRS contractor at Booz Allen Hamilton who made headlines for orchestrating one of the most significant breaches of taxpayer privacy in American history. Between 2018 and 2020, Littlejohn stole and leaked tax records belonging to at least 405,427 taxpayers — including billionaires Jeff Bezos and Elon Musk — to The New York Times and ProPublica. He pleaded guilty and received a five-year prison sentence in 2024.

Yet Trump’s lawsuit ignores the hundreds of thousands of other victims. Instead, it focuses narrowly on his own financial information, seeking a minimum of $10 billion that would come directly from taxpayer coffers and flow into the president and his family’s pockets.

The $750 Question

At the center of Trump’s legal claim lies an uncomfortable truth about his tax history. His attorneys now assert he paid “tens of millions” in taxes — a statement that demands scrutiny.

According to The New York Times’ September 2020 reporting on the leaked documents, Trump paid exactly $750 in federal income taxes in both 2016 and 2017. He paid zero federal income tax in 10 of the 15 years examined, primarily by reporting financial losses that exceeded his earnings.

When Trump claimed in October 2020 that he had “prepaid tens of millions of dollars,” he was referring to estimated quarterly payments — standard practice for self-employed individuals and independent contractors. These payments included payroll taxes and household employment taxes, not federal income tax. To put this in perspective, Americans earning under $40,000 typically pay more in annual federal income tax than Trump did.

The $750 figure represents Trump’s Alternative Minimum Tax calculation for 2017. After reporting a net loss of approximately $12.8 million—$15.3 million in business losses against $7.5 million in income, and applying roughly $7.4 million in general business credits, the IRS minimum tax requirement left him with a $750 liability.

An Unprecedented Conflict of Interest

The lawsuit creates what may be the most significant conflict of interest in American legal history. A sitting president is suing his own government, demanding his own administration pay him $10 billion. The Justice Department, which Trump controls through his political appointees, must legally defend the very agencies he’s attacking.

Treasury Secretary Scott Bessent, who also serves as acting IRS commissioner, signed off on canceling contracts with Littlejohn’s former employer just days before the lawsuit was filed.

This isn’t Trump’s first attempt to extract money from federal agencies. In October 2025, he filed an administrative claim seeking $230 million from the Department of Justice for damages related to federal investigations. Under the Federal Tort Claims Act, any settlement would be paid from federal funds — effectively allowing the president to pocket taxpayer money.

A Question of Proportionality

The $10 billion demand raises eyebrows when compared to congressional allocations for actual federal security or privacy breaches. Trump’s claim dwarfs settlements in major data breaches affecting millions of Americans, suggesting the amount reflects political calculation rather than genuine economic harm.

Littlejohn’s legal team argued that his actions, while criminal, were motivated by concerns about systemic inequality visible in tax records showing billionaires paying minimal taxes on enormous incomes. The irony is stark: Trump now claims to be victimized by the disclosure of information he previously insisted was fake information, showing his minimal federal tax burden as the basis for demanding that taxpayers pay him $10 billion.

Even Republican Senator Ron Johnson acknowledged the ethical complexity, stating that while the IRS “deserves to be sued” over the breach, he questioned whether American taxpayers actually “have $10 billion” for Trump.

The Core Contradiction

The fundamental problem is impossible to resolve: Trump cannot simultaneously dismiss the tax documents as fabricated while demanding $10 billion for their unauthorized disclosure. The legal claim depends entirely on the validity of those very same documents.

Either the documents are authentic (confirming what the Times reported about minimal federal income tax payments) or they’re fabricated, as Trump previously claimed, making the entire lawsuit baseless. Trump is attempting to have it both ways: using government power to increase his personal wealth based on a leak of information he insists was never accurate in the first place.

SOURCES

NBC News. “Trump sues IRS and Treasury Department for $10 billion over leaked tax records.” Jan. 29, 2026. https://www.nbcnews.com/politics/donald-trump/trump-sues-irs-treasury-department-10-billion-leaked-tax-records-rcna256626​

CNBC. “Trump, two sons, Trump Org sue IRS, Treasury for $10 billion over tax records leak.” Jan. 29, 2026. https://www.cnbc.com/2026/01/29/trump-sues-irs-and-treasury-for-10-billion-over-leak-of-tax-records.html​

Politico. “IRS: Contractor leaked more than 400k returns.” Feb. 25, 2025. https://www.politico.com/news/2025/02/25/irs-contractor-leaked-hundreds-of-thousands-of-returns-00205980​

Democracy Docket. “Trump and sons demand $10 billion payout in new lawsuit against IRS.” Jan. 29, 2026. https://www.democracydocket.com/news-alerts/trump-irs-treasury-department-tax-record-10-billion-lawsuit/​

The New York Times. “Trump Paid $750 in Federal Income Taxes in 2017. Here’s the Math.” Sept. 29, 2020. https://www.nytimes.com/2020/09/29/us/trump-750-taxes.html​

BBC. “Donald Trump ‘paid $750 in federal income taxes in 2016 and 2017.’” Sept. 27, 2020. https://www.bbc.com/news/technology-54319948​

CNBC. “Trump says he ‘prepaid’ his taxes. So do millions of other Americans.” Oct. 23, 2020. https://www.cnbc.com/2020/10/23/trump-says-he-prepaid-his-taxes-so-do-millions-of-other-americans.html​

Urban Institute. “Tax Fairness: President Donald Trump, A Case Study.” Oct. 12, 2020. https://www.urban.org/sites/default/files/publication/103051/tax-fairness-donald-trump-a-case-study_1.pdf​

The New York Times. “Trump Paid $750 in Federal Income Taxes in 2017. Here’s the Math.” Sept. 29, 2020.​

The Wall Street Journal. “Trump Lawsuit Against IRS Puts Him on Both Sides of the Same Case.” Feb. 1, 2026. https://www.wsj.com/us-news/law/trump-lawsuit-against-irs-puts-him-on-both-sides-of-the-same-case-116cfa2d​

ABC News 4. “President Donald Trump sues IRS, Internal Revenue Service and Treasury Department for $10 billion over tax return leak.” Jan. 29, 2026. https://abcnews4.com/news/nation-world/president-donald-trump-sues-irs-internal-revenue-service-and-treasury-department-for-10-b​

The Independent. “Why Trump’s $230 Million Claim Exposes a Gap in Settlement Rules.” Nov. 12, 2025. https://www.independent.org/article/2025/11/12/trump-230-million-claim-settlement-president/​

Democracy Docket. “Trump and sons demand $10 billion payout in new lawsuit against IRS.” Jan. 29, 2026.​

Zetter Zeroday. “Booz Allen Tech Contractor Took IRS Job Specifically to Leak Trump’s Tax Records.” Jan. 26, 2026. https://www.zetter-zeroday.com/booz-allen-tech-contractor-took-irs-job-specifically-to-leak-trumps-tax-records/​

Benzinga. “Ron Johnson Says IRS ‘Deserves To Be Sued’ Over Leaked Trump Tax Returns, But Prefers A Probe Instead.” Jan. 31, 2026. https://www.benzinga.com/news/politics/26/02/50290184/ron-johnson-says-irs-deserves-to-be-sued-over-leaked-trump-tax-returns-but​