Survivor Justice Tax Prevention Act

Floor Speech

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Mr. SMITH of Missouri. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 2347) 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, as amended.

The Clerk read the title of the bill.

The text of the bill is as follows: H.R. 2347

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.
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Mr. SMITH of Missouri. Mr. Speaker, I rise in support of H.R. 2347, the Survivor Justice Tax Prevention Act, bipartisan legislation introduced by Representatives Lloyd Smucker and Gwen Moore.

Survivors of sexual assault face a long road to recovery without having to battle with the IRS over keeping the compensatory damages or settlements that they receive.

Unfortunately, right now, the burden of proof that a sexual assault survivor would have to provide to the IRS, including medical records to prove that they deserve to have their settlement funds excluded from gross income for tax purposes, ignores the fact that such victims often do not have the same observable physical injuries that other victims of assault might have.

Mr. Speaker, this clarification in law is desperately needed. I thank Representatives Smucker and Moore for the true compassion they have shown in fighting to right this wrong for victims of sexual assault.
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Mr. SMITH of Missouri. Mr. Speaker, it is disturbing to think that the IRS is allowed to tax survivors of sexual assault on the compensatory damages or the settlements that they have received. Such victims should not have to relitigate their case before the agency, adding insult to the injuries that they have already suffered.

I encourage my colleagues to support this great piece of legislation, and I yield back the balance of my time.

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