S 803 Government Settlement Transparency and Reform Act

About S.803

Government Settlement Transparency and Reform Act This bill amends the Internal Revenue Code to expand provisions relating to the nondeductibility of fines and penalties to prohibit a tax deduction for any amount paid or incurred to, or at the direction of, any governmental entity relating to the violation of any law or the investigation or inquiry into a potential violation of law. The bill exempts from such prohibition:

• (1) restitution or amounts paid to come into compliance with any law that was violated or otherwise involved in the investigation or inquiry,
• (2) amounts paid pursuant to a court order in a suit in which the governmental entity was not a party, and
• (3) amounts paid or incurred as taxes due

The bill also imposes new reporting requirements on governmental entities relating to amounts paid as fines or for restitution.