Joint Committee Report JCS-1-16: General Explanation of Tax Legislation Enacted in the 114th Congress
JCS-1-16
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PART THREE: DON'T TAX OUR FALLEN PUBLIC SAFETY HEROES ACT
(PUBLIC LAW 114-14)18
A. Exclusion of Certain Compensation Received by Public Safety Officers and Their Dependents (sec. 2 of the Act and sec. 104(a) of the Code)
Present Law
Amounts received under a workmen's compensation act as compensation for personal injuries or sickness are excluded from gross income.19 This exclusion applies to amounts received by an employee under a workmen's compensation act, or under a statute in the nature of a workmen's compensation act that provides compensation to employees for personal injuries or sickness incurred in the course of employment, as well as to compensation paid under a workmen's compensation act to the survivor or survivors of a deceased employee.20
Under the Omnibus Crime Control and Safe Streets Act of 1968, if the Bureau of Justice Assistance ("BJA"), an agency of the U.S. Department of Justice, determines that a public safety officer has died as the direct and proximate result of a personal injury sustained in the line of duty, the BJA will pay a monetary benefit to surviving family members or other beneficiary ("public safety officer survivor's benefit").21 In addition, if the BJA determines that a public safety officer has become permanently and totally disabled as the direct and proximate result of a personal injury sustained in the line of duty, the BJA will pay a monetary benefit to the public safety officer ("public safety officer disability benefit").22
With respect to payments made by the Law Enforcement Assistance Administration (a previous agency of the U.S. Department of Justice) under the Public Safety Officers' Benefits Act of 1976 to a surviving dependent of a public safety officer who died as the direct and proximate result of a personal injury sustained in the line of duty, the Internal Revenue Service has ruled that the payments are made under a statute in the nature of a workmen's compensation act and are thus excluded from gross income.23
Explanation of Provision
The provision amends the Code to provide a specific exclusion from gross income for amounts paid (1) by the BJA as a public safety officer survivor's benefit or public safety officer disability benefit, or (2) under a State program that provides monetary compensation for surviving dependents of a public safety officer who has died as the direct and proximate result of a personal injury sustained in the line of duty, except that the exclusion does not apply to any amounts that would have been payable if the death of the public safety officer had occurred other than as the direct and proximate result of a personal injury sustained in the line of duty.
Effective Date
The provision is effective on the date of enactment (May 22, 2015).
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