No Taxation on PFAS Remediation Act
Summary
H.R. 6669, the "No Taxation on PFAS Remediation Act," aims to amend the Internal Revenue Code of 1986 by excluding reimbursements for PFAS (per- and polyfluoroalkyl substances) remediation from gross income. This means individuals receiving funds to clean up PFAS contamination would not have to pay federal income tax on those reimbursements. The bill also includes a provision to extend the statute of limitations for claiming a credit or refund related to this amendment, providing a one-year window after enactment.
Expected Effects
If enacted, this bill would reduce the tax burden on individuals receiving reimbursements for PFAS remediation. It would also incentivize more people to address PFAS contamination, as the full reimbursement amount would be available for cleanup efforts. The change would apply retroactively to taxable years beginning after December 31, 2020.
Potential Benefits
- Reduces the financial burden on individuals dealing with PFAS contamination.
- Encourages more comprehensive and faster remediation of PFAS pollution.
- Simplifies the tax process for those receiving remediation reimbursements.
- Provides a retroactive benefit, assisting those who have already undertaken remediation efforts.
- Potentially improves public health by facilitating quicker cleanup of contaminated sites.
Potential Disadvantages
- May slightly reduce federal tax revenue, though the impact is likely minimal.
- Could create a loophole if not carefully defined, potentially allowing for abuse of the reimbursement exclusion.
- Might disproportionately benefit individuals in areas with known PFAS contamination, creating a perceived inequity.
- The retroactive application could create administrative complexities for the IRS.
- The bill does not address the source of PFAS contamination or hold polluters accountable.
Constitutional Alignment
This bill aligns with the general welfare clause of the US Constitution, as it aims to promote public health and environmental protection by incentivizing the cleanup of PFAS contamination. Congress has the power to lay and collect taxes, but also the implied power to create exemptions and deductions within the tax code to achieve policy goals. Article I, Section 8 grants Congress the power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).