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119-s-584119th CongressWALLET

Tax Fairness for Survivors Act

Sponsored By: Senator Gillibrand, Kirsten E. [D-NY]

Introduced

Summary

Excludes sexual-assault and sexual-harassment judgments, awards, and settlements from taxable income. The bill would add a new Section 139J to the tax code and specify that qualifying payments are not part of an individual's gross income.

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Bill Overview

Analyzed Economic Effects

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

No payroll taxes on survivor awards

If enacted, amounts that are tax-free under the new exclusion would also not count as wages for payroll taxes and withholding. The bill would exclude such amounts from Social Security wages, railroad retirement compensation, FUTA wages, and wages subject to withholding. This change would apply for taxable years beginning after the date of enactment and would affect withholding and employer payroll tax calculations for covered payments.

Tax-free settlements for survivors

If enacted, you would not include judgments, awards, or settlements for sexual assault, sexual contact, or sexual harassment in your federal gross income. This covers back pay, front pay, punitive damages, attorney fee reimbursements, and payments tied to releases, whether paid in a lump sum or over time. The change would apply for taxable years beginning after the date of enactment. You only benefit if you actually receive a qualifying award.

Sponsors & CoSponsors

Sponsor

Gillibrand, Kirsten E. [D-NY]

NY • D

Cosponsors

  • Sen. Blackburn, Marsha [R-TN]

    TN • R

    Sponsored 2/13/2025

Roll Call Votes

No roll call votes available for this bill.

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