Sexual assault settlement money would be fully tax-free under HR 1306
In committeeH.R. 1306Latest action
Sponsor: Lois Frankel · Representative · FL
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Official title: Tax Fairness for Survivors Act
119th Congress
Topics: Jobs & the economy
Introduced:
Read the official bill on Congress.govIn plain words
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HR 1306 would exempt all sexual assault and harassment lawsuit payments from federal income, payroll, and withholding taxes.
45-second read · 4 questions answered below
What does this do?
HR 1306 would remove federal income taxes from any money received through a court judgment or settlement in a sexual assault or sexual harassment case. The exemption covers lump-sum and structured payments alike, including back pay, punitive damages, and attorney's fees. It would also block Social Security, Medicare, unemployment, and wage withholding taxes from applying to those payments.
Who does it affect?
The bill affects people who receive money from sexual assault or sexual harassment judgments or settlements. It also affects employers and defendants who make those payments, since they would no longer be required to withhold taxes from them.
Why does it matter?
Under current law, some money received from these cases can be subject to federal taxation depending on the type of claim. If enacted, the change would take effect starting with the tax year after the bill is .
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Where does it stand?
- IntroducedFeb 13, 2025
- House committeeYou are here · Feb 13, 2025
- House vote
- Senate
- The president's desk
Right now: a House committee is reviewing it. If the Senate changes it, it goes back to the House before reaching the president.
Latest action: — Referred to the House Committee on Ways and Means.