Congress raises tax break for public safety officer retirees
H.R. 3327 — Public Safety Retirees Healthcare Protection Act of 2025 · Filed by Don Bacon (R-NE) · 7 cosponsors · Introduced May 13, 2025 · Referred to committee
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What it does
This bill doubles the annual tax exclusion for public safety officers (police, firefighters, etc.) who receive distributions from government retirement plans to pay for health insurance or long-term care, from $3,000 to $6,000 per year. The change takes effect for distributions made after December 31, 2025, meaning eligible retirees will owe federal income tax on less of their retirement income.
Why we flagged it
The bill's sole operative mechanism is a straightforward increase in a tax exclusion cap for a specific beneficiary class. It does exactly what its title says, with no hidden riders or misdirection.
What the text implies
- The $6,000 cap applies only to distributions for health and long-term care insurance premiums; retirees cannot use it for other retirement expenses, limiting its scope.
- The benefit accrues only to public safety officers with access to governmental retirement plans; private-sector security workers and those without such plans receive no benefit.
The full analysis lists 3 implications of this text.
Who stands to gain
public safety officer retirees (police, firefighters, emergency responders)