Tackling Predatory Litigation Funding Act

The bill would impose a new tax on income received by third-party entities that provide financing for litigation, such as lawsuits or legal claims, where those entities are not attorneys representing a party in the case. The tax would equal the highest individual income tax rate plus an additional 3.8 percentage points, applied to qualified litigation proceeds—defined as gains, income, or profit derived from litigation financing agreements—and would be levied at the entity level for pass-through entities like partnerships and S corporations. The bill also includes provisions for tax withholding by the parties involved in the litigation (such as named parties or law firms) and excludes…

No official summary is available here. This one was written by AI from the bill’s text.