H.R. 6227: Human Trafficking Survivor Tax Relief Act (119th Congress) Bill Summary

This bill, titled the Human Trafficking Survivor Tax Relief Act, proposes changes to the Internal Revenue Code of 1986 concerning how certain financial awards are treated for tax purposes, specifically related to victims of human trafficking. Here are the key points of the bill:

Purpose of the Bill

The primary purpose of this bill is to provide tax relief to survivors of human trafficking by excluding specific types of financial compensation from their taxable income. This aims to alleviate the financial burden on survivors who have already suffered significant trauma.

What It Excludes from Gross Income

The bill amends the Internal Revenue Code to state that the following types of awards will not be counted as gross income:

Any civil damages awarded in a lawsuit under section 1595 of title 18, United States Code.
Any restitution ordered in a criminal case under section 1593 of title 18, United States Code.

In simpler terms, if a survivor of human trafficking receives money as compensation for their experience, whether through civil actions or criminal restitution, that money will not be taxed as income.

Why This Matters

Excluding these awards from gross income means that survivors will keep more of the money they receive, which can be crucial for their recovery and rehabilitation. The support provided through these awards is often essential for rebuilding their lives.

Effective Date

The changes proposed in the bill would take effect for taxable years beginning after the bill is enacted. This means that any awards received in the tax years following the enactment would be exempt from being counted as income.

Conforming Amendments

The bill also includes technical amendments to ensure that the new provisions are properly integrated into the existing tax code, ensuring clarity in how these exclusions are applied.

Overall Impact

This legislation is designed specifically to support survivors of human trafficking by easing potential tax burdens related to compensatory awards they may receive. By doing so, it seeks to promote their financial stability and aid in their recovery process after such traumatic experiences.