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[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 4801 Introduced in Senate (IS)]

<DOC>

118th CONGRESS
  2d Session
                                S. 4801

  To amend the Internal Revenue Code of 1986 to exclude discharge of 
                coerced indebtedness from gross income.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             July 25, 2024

  Ms. Smith (for herself and Ms. Klobuchar) introduced the following 
  bill; which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL

 
  To amend the Internal Revenue Code of 1986 to exclude discharge of 
                coerced indebtedness from gross income.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Tax Relief for Coerced Debt Act of 
2024''.

SEC. 2. EXCLUSION OF DISCHARGED OF COERCED INDEBTEDNESS.

    (a) In General.--Section 108 of the Internal Revenue Code of 1986 
is amended by adding at the end the following new subsection:
    ``(j) Treatment of Discharge of Coerced Indebtedness.--
            ``(1) In general.--In the case of an individual, gross 
        income does not include any amount which (but for this 
        subsection) would be includible in gross income by reason of 
        the discharge (in whole or in part) of coerced indebtedness.
            ``(2) Coerced indebtedness.--For purposes of this 
        subsection--
                    ``(A) In general.--Indebtedness of an individual 
                shall be treated as coerced indebtedness if--
                            ``(i) the indebtedness, or any portion 
                        thereof, was incurred--
                                    ``(I) as the result of the 
                                unknowing and unauthorized use of 
                                personal identifying information of the 
                                individual, or
                                    ``(II) by reason of economic abuse, 
                                intimidation, harassment, threat of 
                                force, force, fraud, deception, 
                                coercion, undue influence, or other 
                                similar means, and
                            ``(ii) the individual is relieved of 
                        personal liability for the debt or any 
                        obligation to the creditor or other claimants 
                        pursuant to a court judgement.
                    ``(B) Economic abuse.--The term `economic abuse' 
                means behavior, without regard to the relationship 
                context in which such behavior occurs, which is 
                otherwise described in section 40002(a)(13) of the 
                Violence Against Women Act of 1994, and includes 
                interference with the individual's ability to work.
            ``(3) Reporting and filing requirements.--The Secretary 
        shall ensure that no additional reporting or filing 
        requirements are imposed on the individual with respect to the 
        exclusion under this subsection.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to discharges of indebtedness after December 31, 2023.
                                 <all>
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