CFE Supports Pro-Taxpayer Legislation Marked Up in U.S. House Ways and Means Committee

This week, the U.S. House Ways and Means Committee will mark up five narrow bills that would each, in their own way, make the tax code work better for taxpayers. The Center for a Free Economy is proud to endorse all five bills. They are:

H.R. 2347, the "Survivor Justice Tax Prevention Act," sponsored by Congressman Lloyd Smucker (R-Penn.) This bill would make it clear that monies taxpayers receive as damages for sexual assault do not require invasive and re-traumatizing inquires by the IRS to be presumed as free of tax under the law. It doesn't matter if the victim's attack wasn't medically documented, and it doesn't matter if the monetary decision doesn't explicitly mention the sexual assault.

H.R. 5366, the "Doug LaMalfa Federal Disaster Tax Relief Certainty Act," sponsored by Congressman Doug LaMalfa (R-Cal.), would make it easier for taxpayers to claim a net casualty deduction in a presidentially-declared disaster area, including disasters from the recent past. Anyone can claim the deduction, whether they itemize deductions or not, after a $500 per casualty haircut, and without the current 10% of AGI haircut.

H.R. 5334, the "Supporting Early Childhood Educators' Deductions Act of 2025," sponsored by Congressman Jimmy Panetta (D-Cal.) would expand the definition of an out of pocket teacher expense available for a tax deduction to qualified expenses incurred by pre-K teachers and other professionals at pre-K schools and facilities.

H.R. 7971, the "Taxpayer Experience Improvement Act," sponsored by Congressman David Schweikert (R-Ariz.), would require the IRS to make telephone wait times publicly available both in retrospect and in real time, and allow taxpayers to know how much their wait time on hold will be before they call. H.R. 7959, the "IRS Whistleblower Program Improvement Act," sponsored by Congressman Mike Kelly (R-Penn.), would make necessary improvements to the IRS whistleblower program. The U.S. Tax Court would have a more common sense standard of review. Privacy protection for whistleblowers is strengthened. The IRS would need to do an annual report listing the top ten savings made by whistleblowers. Whistleblowing awards can be collected with interest if unduly delayed. Attorney fees would be tax deductible against whistleblower awards. The only things missing here are: an exemption of IRS whistleblower awards from budget sequestration, putting them on the same playing field as other whistleblower awards; and, a repeal of the arbitrary dollar caps unique to IRS whistleblower awards.