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119-hr-1168119th CongressWALLET

Protecting Federal Funds from Human Trafficking and Smuggling Act of 2025

Sponsored By: Representative Gooden, Lance [R-TX-5]

Introduced

Summary

Require nonprofits to certify compliance with human trafficking and smuggling laws to get federal funds. It would also let the IRS deny 501(c) status for noncompliance and remove a longtime exemption that let charities skip eligibility checks for federal public benefits.

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  • Nonprofit organizations: Nonprofits would have to certify compliance to receive federal funding. Future recipients must certify within 120 days. Failure can force repayment of funds and lead to denial of tax-exempt status.
  • Program participants and families: People who get services from charities that distribute federal public benefits could face formal eligibility checks that charities previously did not have to do.
  • Federal oversight and Homeland Security: The Department of Homeland Security would have to publish a compliance strategy and best practices and post violation information. The Comptroller General would report to Congress within 180 days and then annually on certification violations.

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Bill Overview

Analyzed Economic Effects

3 provisions identified: 0 benefits, 1 costs, 2 mixed.

Nonprofits could lose tax-exempt status

If enacted, 501(c) nonprofits that do not submit the required certification or are found to have violated 8 U.S.C. 1324 would lose their tax-exempt status. They could reapply no sooner than one year after losing it. Losing exemption would mean paying income taxes and handling more paperwork.

Changes to nonprofit charity verification

This bill would strike subsection 432(d) of the 1996 welfare law (8 U.S.C. 1642). That subsection deals with how nonprofit charitable groups handle eligibility verification for public benefits. If passed, this could change what checks charities must make before giving help; the summary does not list exact programs.

New compliance rules for federally funded nonprofits

This bill would require nonprofits that get federal money to certify to the budget office that they follow laws on trafficking, smuggling, fraud, bribery, and gratuities, and have not violated 8 U.S.C. 1324. Groups that already got funds as of enactment or were awarded funds before January 1, 2025 would have 60 days to certify. Starting no later than 120 days after enactment, new awards to nonprofits would require that certification. If a group does not certify, or is found to have violated 8 U.S.C. 1324, it could have to repay the federal money. Within 120 days, Homeland Security would issue best practices, post nonprofit violations on its website, and plan better coordination with law enforcement.

Sponsors & CoSponsors

Sponsor

Gooden, Lance [R-TX-5]

TX • R

Cosponsors

  • Rep. Biggs, Andy [R-AZ-5]

    AZ • R

    Sponsored 2/10/2025

  • Rep. Gill, Brandon [R-TX-26]

    TX • R

    Sponsored 2/10/2025

  • Rep. Mace, Nancy [R-SC-1]

    SC • R

    Sponsored 2/10/2025

  • Rep. Weber, Randy K. Sr. [R-TX-14]

    TX • R

    Sponsored 2/10/2025

  • Rep. Gosar, Paul A. [R-AZ-9]

    AZ • R

    Sponsored 2/10/2025

  • Rep. Ellzey, Jake [R-TX-6]

    TX • R

    Sponsored 2/10/2025

  • Rep. Ogles, Andrew [R-TN-5]

    TN • R

    Sponsored 2/10/2025

  • Rep. Rose, John W. [R-TN-6]

    TN • R

    Sponsored 2/10/2025

  • Rep. Haridopolos, Mike [R-FL-8]

    FL • R

    Sponsored 2/10/2025

  • Rep. Tiffany, Thomas P. [R-WI-7]

    WI • R

    Sponsored 2/11/2025

Roll Call Votes

No roll call votes available for this bill.

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