Rep. Lloyd Smucker
Bipartisan tax legislation led by U.S. Rep. Lloyd Smucker (R-PA) is on a fast track to approval after the U.S. House Ways and Means Committee approved the bill on March 25.
Rep. Smucker on the same day sponsored the Survivor Justice Tax Prevention Act, H.R. 2347, alongside lead cosponsor U.S. Rep. Gwen Moore (D-WI) to amend the nation’s tax code to ensure survivors of sexual abuse and unwanted and illegal sexual contact do not have to pay taxes on settlement income when they prevail legally against their abuser.
“I want to thank my Ways and Means colleagues for advancing this bill and for standing with survivors of sexual assault,” Rep. Smucker said. “This legislation brings greater clarity and fairness to our tax code. Survivors have endured unimaginable trauma, and eliminating this unjust tax burden is an important step toward providing them with the peace and fairness they deserve. I look forward to continuing to work with my colleagues to deliver justice for these survivors.”
Under current law, settlement income for personal physical injuries is excluded from federal taxable income, but the IRS generally requires these taxpayers to provide evidence of a visible physical injury prior to allowing tax-free treatment. This standard can be particularly burdensome for sexual assault victims who have not sustained a visible injury, according to Rep. Smucker.
If enacted, his bill would allow survivors to receive tax-free compensation without the need to demonstrate visible physical injuries.
“The Survivor Justice Tax Prevention Act is a much-needed change in tax policy to ensure survivors of sexual assault and sexual abuse are able to exclude damages or settlements when they file taxes,” said House Ways and Means Committee Chairman Jason Smith (R-MO). “Rep. Smucker has been a champion of this effort to provide relief for those who have already had to endure a horrendous crime. I commend him for his compassion and for his work to build bipartisan support for survivors and end unnecessary and unreasonable IRS red tape.”
The bill now heads to the full House for a vote.