No Taxation on PFAS Remediation Act
- Sponsor
- Rep. Pappas, Chris [D-NH-1]
- Committees
- Ways and Means Committee (primary)
- Last action
- Dec 11, 2025
Bottom line
The bill aims to prevent individuals from being taxed on money they receive to clean up PFAS contamination, thereby reducing their financial burden and encouraging remediation efforts.
What it actually does
This bill amends the Internal Revenue Code of 1986 to exclude from an individual's gross income any amounts received as reimbursement for the remediation of contamination by perfluoroalkyl or polyfluoroalkyl substances (PFAS). It creates a new section 139M to implement this exclusion and extends the statute of limitations for related tax credits or refunds. The provisions apply retroactively to reimbursements made in taxable years beginning after December 31, 2020.
Proponents argue
Supporters argue that it is fundamentally unfair to tax individuals on reimbursements intended to cover the costs of environmental damage they did not cause. They contend that this exclusion provides necessary financial relief to victims of PFAS contamination, helps them recover from an unforeseen burden, and removes a potential disincentive for undertaking crucial environmental cleanup activities.
Opponents contend
Critics might argue that while the intent is sympathetic, creating specific tax exclusions for particular types of reimbursements can lead to increased complexity in the tax code. They may also raise concerns about potential federal revenue loss, especially if PFAS remediation becomes widespread, and suggest that a more comprehensive or direct aid approach might be preferable to a tax carve-out.
The bill is exceptionally short and clearly written, making it very accessible for a quick read and easy to understand its core purpose.
Section 2(a) and (d)
Exclusion of PFAS Remediation Reimbursements from Gross Income
This provision amends the Internal Revenue Code to establish that any money an individual receives as a reimbursement for cleaning up contamination caused by perfluoroalkyl and polyfluoroalkyl substances (PFAS) will not be considered taxable income. This means individuals will not have to pay federal income tax on funds specifically received to cover the costs of remediating PFAS contamination. The exclusion is made retroactive, applying to reimbursements received in taxable years beginning after December 31, 2020.
Supporters argue
Supporters argue this provision ensures fairness by preventing individuals from being taxed on funds meant to restore their property or health due to contamination they did not cause. It removes a disincentive for remediation and supports those affected by environmental pollution, aligning with principles of environmental justice.
Critics contend
Opponents might argue that while the specific issue is sympathetic, creating carve-outs in the tax code for specific types of reimbursements can lead to a more complex and less equitable tax system. They might suggest that direct grants or other forms of aid might be more transparent than tax exclusions.
Tradeoffs
The bill balances the desire to provide financial relief to individuals affected by PFAS contamination against the principle of a broad tax base and the potential for increased complexity in the tax code. It also involves a tradeoff between immediate financial relief for affected individuals and potential long-term federal revenue implications.