Official Summaries

Survivor Justice Tax Prevention Act

This bill excludes from gross income certain damages received by an individual due to any sexual act or sexual contact and establishes the applicable burden of proof in court proceedings regarding the characterization of such damages for federal tax purposes. 

Under current law, amounts received as damages (other than punitive damages) from a judgment, award, or settlement of a claim may be excluded from gross income and, thus, are not subject to federal income tax, if attributable to a personal physical injury or physical sickness. The Internal Revenue Service (IRS) generally interprets personal physical injury to require observable bodily harm (e.g., bruising, cuts, swelling, or bleeding).

Under the bill, amounts received as damages (other than punitive damages) from a judgment, award, or settlement due to any sexual act or sexual conduct, whether or not there are medical records or observable injuries of such act or contact, may be excluded from gross income.

Further, if a judgment, award, or settlement states that damages are due to any sexual act or sexual conduct, then the IRS has the burden of proving otherwise in court proceedings related to the tax liability associated with such damages. 

Finally, the bill requires the IRS to promote public awareness of the exclusion from gross income of damages related to any sexual act or sexual contact.

Current Full Text

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2347 Engrossed in House (EH)]

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119th CONGRESS
  2d Session
                                H. R. 2347

_______________________________________________________________________

                                 AN ACT


 
To amend the Internal Revenue Code of 1986 to exclude from gross income 
 any damages, other than punitive damages, received on account of any 
                     sexual acts or sexual contact.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Survivor Justice Tax Prevention 
Act''.

SEC. 2. EXCLUSION FROM GROSS INCOME OF ANY DAMAGES, OTHER THAN PUNITIVE 
              DAMAGES, RECEIVED ON ACCOUNT OF SEXUAL ACTS OR SEXUAL 
              CONTACT.

    (a) In General.--Section 104(a)(2) of the Internal Revenue Code of 
1986 is amended by striking ``on account of personal physical injuries 
or physical sickness;'' and inserting ``on account of--
                    ``(A) personal physical injuries or physical 
                sickness, or
                    ``(B) any sexual act (as defined in paragraph (2) 
                of section 2246 of title 18, United States Code, as in 
                effect on the date of the enactment of this 
                subparagraph) or sexual contact (as defined in 
                paragraph (3) of such section, as so in effect), 
                whether or not there are medical records or observable 
                injuries of such act or contact;''.
    (b) Burden of Proof With Respect to Whether Damages Are on Account 
of Sexual Act or Sexual Contact.--Section 104 of such Code is amended 
by redesignating subsection (d) as subsection (e) and by inserting 
after subsection (c) the following new subsection:
    ``(d) Burden of Proof With Respect to Whether Damages Are on 
Account of Sexual Act or Sexual Contact.--For purposes of subsection 
(a)(2), if a decision or agreement states that any damages received 
therefrom are on account of a sexual act or sexual contact referred to 
in subsection (a)(2)(B)--
            ``(1) such statement shall be treated as credible evidence 
        that such damages are so on account for purposes of section 
        7491(a), and
            ``(2) the taxpayer shall be treated as having met the 
        requirements of section 7491(a)(2) with respect to the issue of 
        whether such damages are so on account.''.
    (c) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to amounts received pursuant to decisions made, and 
        agreements entered into, after the date of the enactment of 
        this Act.
            (2) Special rule for decisions.--For purposes of paragraph 
        (1), a decision shall be treated as made after the date of the 
        enactment of this Act if the first payment pursuant to such 
        decision is received after such date.
            (3) Special rule for agreements.--For purposes of paragraph 
        (1), an agreement shall not be treated as entered into after 
        the date of the enactment of this Act if such agreement 
        replaces, supersedes, or revises an agreement entered into on 
        or before such date.
    (d) No Inference With Respect to Effect of Medical Records or 
Observable Injuries on Determinations With Respect to Personal Physical 
Injuries or Physical Sickness.--No inference may be drawn from the 
amendment made by subsection (a) (or from section 104(a)(2)(B) of the 
Internal Revenue Code of 1986, as amended by subsection (a)) with 
respect to whether the term ``personal physical injuries or physical 
sickness'' as used in section 104(a)(2) of such Code includes injuries 
or sickness with respect to which there are no medical records or 
observable injuries.
    (e) Promotion of Public Awareness of Exclusion.--The Secretary of 
the Treasury (or the Secretary's delegate), in consultation with the 
Department of Justice Office on Violence Against Women and other 
relevant Federal agencies, shall conduct a program to promote public 
awareness of the exclusion from gross income provided by section 
104(a)(2)(B) of the Internal Revenue Code of 1986, as amended by this 
section.

            Passed the House of Representatives April 27, 2026.

            Attest:

                                                                 Clerk.
119th CONGRESS

  2d Session

                               H. R. 2347

_______________________________________________________________________

                                 AN ACT

To amend the Internal Revenue Code of 1986 to exclude from gross income 
 any damages, other than punitive damages, received on account of any 
                     sexual acts or sexual contact.