Thompson, LaMalfa Introduce Bipartisan Bill to Ensure Fire Victims Don’t Pay Taxes on PG&E Court-Ordered Trust Payments

Press Release

Posted: April 2, 2022

Washington – Today, Reps. Mike Thompson (CA-05) and Doug LaMalfa (CA-01) introduced bipartisan legislation to ensure that no fire survivors are taxed on the payments they received from the PG&E Fire Victims Trust. Following fires in 2015, 2017, and 2018, PG&E established a court-ordered trust of over $13 billion for survivors of these devastating events.

“I have heard from constituents across our community who are deeply, deeply concerned that they will face a tax burden upon receiving a payout from PG&E,” said Thompson. “This trust was set up to help people get back on their feet and recover after a destructive fire. They should not have to pay taxes on these payouts. I am proud to introduce this bill alongside Rep. LaMalfa to help our constituents receive the money they are owed, and will continue working to ensure survivors have the resources they need to recover from these tragedies.”

“Fire victims have lost homes, belongings, and for some, even their loved ones. We should not ask survivors to pay federal taxes on compensation that they will use to rebuild their lives. And we certainly should not be asking them to pay taxes on funds that are going to their lawyers—this would be double taxing the settlement dollars. I have heard firsthand the concerns survivors have faced when navigating the ambiguous tax code. This bill has been a long time coming, and I look forward to continuing this effort with Rep. Thompson so survivors can finally get a financial reprieve,” said LaMalfa.

The legislation ensures no fire survivors will be taxed on their PG&E Fire Victims Trust payments. The legislation also includes a provision exempting attorneys’ fees from taxation to ensure that recipients of PG&E funds do not pay taxes on lawyers they did not hire.