Human Trafficking Survivor Tax Relief Act

Bill Number

H.R. 6227

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Taxation

Status

Introduced

Latest Action

2025-11-20: Referred to the House Committee on Ways and Means.

Last Updated

2025-12-11T15:25:43Z

AI-Generated Summary

Purpose

The Human Trafficking Survivor Tax Relief Act (H.R. 6227) aims to provide financial relief to victims of human trafficking by ensuring that certain restitution payments and civil damages they receive are not subject to federal income tax. This helps survivors keep more of the compensation intended to make them whole after experiencing trafficking crimes.

Key Provisions

• Tax Exclusion: Adds a new section (139M) to the Internal Revenue Code of 1986, excluding from gross income any civil damages, restitution, or other monetary awards (including compensatory or statutory damages) received by victims.
• Covered Awards: The exclusion applies specifically to:
• Restitution ordered under section 1593 of Title 18, U.S. Code (which requires criminals convicted of human trafficking to pay victims for their losses).
• Damages awarded in civil actions under section 1595 of Title 18, U.S. Code (which allows victims to sue traffickers directly for compensation).
• Effective Date: Applies to taxable years beginning after the date the Act is enacted into law.
• Short Title: The legislation is titled the "Human Trafficking Survivor Tax Relief Act."

Significant Changes to Existing Law

• Under current tax law, restitution or civil damages for personal injuries or crimes are generally included in gross income and taxable, unless specifically excluded (e.g., for certain physical injuries). This Act creates a targeted new exclusion for human trafficking-related awards, which were previously taxable. It inserts the provision into Part III of Subchapter B of Chapter 1 of the Internal Revenue Code and updates the table of sections accordingly.

Potential Impacts

• On Citizens: Primarily benefits survivors of human trafficking by allowing them to retain the full amount of awarded compensation without owing federal income taxes, potentially improving their financial recovery and stability after trauma.
• On Government Agencies: The Internal Revenue Service (IRS) will need to adjust tax reporting and enforcement processes to recognize these exclusions, which may involve updating forms, guidance, and audits. No direct impact on international relations is evident, though it supports broader U.S. efforts to combat human trafficking globally.
• Broader Effects: Could encourage more victims to pursue legal remedies, knowing the awards won't be reduced by taxes, indirectly aiding law enforcement and judicial systems in addressing trafficking cases.

Main Stakeholders Affected

• Victims/Survivors of Human Trafficking: Direct beneficiaries who receive non-taxable compensation.
• Internal Revenue Service (IRS): Responsible for implementing the tax exclusion in tax filings and collections.
• Department of Justice (DOJ) and Courts: Involved in ordering or awarding the restitution and damages, with potential indirect benefits from increased victim participation in prosecutions or civil suits.
• Traffickers and Related Parties: Indirectly affected, as non-taxable awards might make civil actions more appealing to victims, increasing legal accountability.

Notable Legal, Constitutional, or Political Implications

• Legal: Strengthens victim protections under federal anti-trafficking laws (e.g., the Trafficking Victims Protection Act framework) by addressing a financial barrier to recovery. No conflicts with existing tax code exclusions are apparent, but it may require IRS regulations to clarify implementation details.
• Constitutional: Aligns with the Taxing and Spending Clause (Article I, Section 8) by Congress's authority to define taxable income; raises no evident free speech, due process, or equal protection issues, as it targets a specific class of victims without discrimination.
• Political: Reflects bipartisan support (introduced by members from both parties) in prioritizing survivor aid amid ongoing national efforts to combat human trafficking. Could set a precedent for tax relief in other victim compensation contexts, potentially influencing future legislation on crime-related damages.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Schneider, Bradley Scott [D-IL-10]

Cosponsors (3)

Rep. Arrington, Jodey C. [R-TX-19], Rep. Sewell, Terri A. [D-AL-7], Rep. Moore, Blake D. [R-UT-1]

Recent Actions

• 2025-11-20: Referred to the House Committee on Ways and Means.
• 2025-11-20: Introduced in House
• 2025-11-20: Introduced in House

Bill Versions

• Human Trafficking Survivor Tax Relief Act — issued 2025-11-20 — PDF (3 pages)