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.
Final Score: Under $1 billion—for 2026 to 2035
Summary: The pending legislation introduced by Representative Smucker focuses on two key provisions. The first is to ensure victims of sexual abuse who receive gross income on damages, excluding punitive damages, would not have the monetary damages received count as part of their gross income for tax purposes. The second provision of the proposed bill is that the Secretary of the Treasury, in consultation with the Department of Justice, shall conduct a public awareness campaign.
The costs associated with this proposed legislation is twofold, the loss of tax revenue from damages on sexual abuse cases and the cost of the public awareness campaign. In order for the value of these losses to exceed the Fiscal Lab’s de minimis value ($100 million per year or $1 billion per 10-year window), the damages received would have to exceed a few hundred million a year so that that loss of potential tax revenue plus the cost of the public awareness campaign would approximate $100 million per year. There may also be some additional costs to amend the existing tax code to account for the changes. However, it is likely these costs would be absorbed by the various agencies. The public awareness campaign is likely not going to increase expenses beyond the de minimis threshold.
Sexual abuse data are tracked through the US Department of Justice’s Office of Just Programs as part of their Bureau of Justice Statistics. However, the raw data are often not provided with summary statistics shared through various reports. Additionally, the data with regard to potential payouts awarded to victims are not organized through a single comprehensive US database.
There is a 2005 special report that was released that looked at some compensatory damages that were paid, but there is no data within that report that examines sexual abuse compensatory damages paid. Additionally, it does not appear that this special report continued tracking compensatory damages. Upon conversations with individuals familiar with the data availability, or lack thereof, there is likely no clear way to consistently or easily track the data, as they are only available through each state’s judicial system with different administrative tracking.
Additionally, as we tried to examine the potential data through IRS returns, compensatory damages are not tracked through the IRS as a single measure and are instead identified as physical injury, loss of wages, emotional distress, or punitive damages. In these instances, the reasoning for the compensatory damages, such as caused by sexual abuse, is not tracked.
As noted above, given the lack of available data on compensatory awards, the Fiscal Lab is unable to calculate a true score. However, based upon the information observed, it is unlikely this proposed legislation would have a significant monetary cost.
Source(s):
Mark A. Motivans, Federal Justice Statistics, 2023 (US Department of Justice, Office of Justice Programs, March 2025).
United States Sentencing Commission, “Quick Facts: Sexual Abuse Offenses,” Fiscal Year 2024.
Lynn Langton and Thomas H. Cohen, Civil Bench and Jury Trials in State Courts, 2005 (US Department of Justice, Bureau of Justice Statistics, revised April 2009).
Modeling Used: None
Additional Notes:
If Representative Smucker would like further information, his best approach would be to contact the Administrative Office of the US Courts to request data on federal jury awards. Unfortunately, this data is not public and is not accessible except by congressional request.