Congress moves to spare sexual assault survivors from federal taxes on settlements
H.R. 1306 — Tax Fairness for Survivors Act · Filed by Lois Frankel (D-FL) · 5 cosponsors · Introduced Feb 13, 2025 · Referred to committee
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What it does
This bill exempts payments received from sexual assault or sexual harassment settlements, judgments, and awards from federal income taxation. Survivors would not owe income tax on these payments—whether lump-sum or periodic—including damages, attorney's fees, and backpay, and the bill also excludes these amounts from Social Security, railroad retirement, unemployment, and wage-withholding taxes.
Why we flagged it
The bill's core mechanism is a straightforward tax exclusion for sexual assault and harassment settlement proceeds. It operates as a targeted tax relief measure that aligns survivor compensation with existing personal-injury tax policy.
What the text implies
- Survivors may face reduced Social Security benefit calculations if settlements are excluded from wage-base calculations, potentially lowering future retirement benefits.
- The exclusion applies to all settlement components (punitive damages, attorney's fees, backpay), which may create administrative complexity in distinguishing taxable vs. non-taxable portions in mixed settlements.
- Employers and payroll processors will need updated guidance to correctly exclude these payments from wage reporting and tax withholding, creating compliance burden during transition.
Section numbers refer to the bill text the analysis read — linked under Primary records below.
Who it affects
Survivors of sexual assault and harassment gain a concrete financial benefit by retaining more of their settlement proceeds without federal tax liability. This reduces the tax burden on victims and recognizes that compensation for harm should not be treated as taxable income, aligning with existing tax policy for other personal-injury settlements.
Named in the bill
Internal Revenue Service (IRS), U.S. Department of Treasury, Social Security Administration, Railroad Retirement Board
Where it stands
5 cosponsors: 3 Republicans, 2 Democrats.
- Feb 13, 2025 — Introduced · Congress.gov: “Introduced in House”
- Feb 13, 2025 — Referred to House Committee on Ways and Means · Congress.gov: “Referred to the House Committee on Ways and Means”
Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.
Money around this bill
1 lobbying clients named this bill on 2 disclosure filings across 2 quarters, Dec 2025 to Jun 2026. Those filings disclosed $3,610,000 in lobbying spend. A filing names 120 bills on average, so that figure is what each filing reported, not a share belonging to this bill.
More lobbying clients named this bill than 0% of bills with at least one filing.
Lois Frankel, the sponsor, reported $555,750 in PAC receipts in the 2026 cycle.
- American Association for Justice — $3,610,000 on 2 filings
Lobbying Disclosure Act filings through Jul 20, 2026. A filing shows who paid to lobby on a bill it names, not what changed.
How this was measured
Analysis — Quorum's AI read the bill text published by Congress.gov (3,069 characters) on Jul 25, 2026. Section numbers in the findings refer to that text, linked below; transparency and hidden-provision scores are compared against the median of 16,222 analysed bills.
Status and sponsors — Congress.gov's bill record — actions, committee referrals and cosponsors — loaded nightly. The timeline shows status changes, not every procedural action.
Money — Senate Lobbying Disclosure Act filings whose specific-issue field names this bill for quarters ending Dec 2025 to Jun 2026. A filing's amount is reported whole beside the median number of bills a filing names; it is never divided across them. PAC receipts are FEC-reported contributions to the sponsor's candidate committee in the 2026 cycle.
As of — lobbying records through Jul 20, 2026 · page rendered 2026-10-20.
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