Sponsors (2)
The bill substantially increases and broadens tax‑free death and funeral payments and speeds payments to survivors—providing significant immediate relief to families of federal employees and service members—while increasing federal costs, creating potential strains on agency operating funds, and introducing avenues for disputes or delays over eligibility.
Surviving family members of federal employees and service members receive a guaranteed one-time death gratuity of $100,000 (adjusted annually) that is available to more frontline workers (including FAA, TSA, certain VA/VHA staff) and applies to deaths abroad, providing substantial, immediate tax-free financial relief to families.
Survivors (families of federal employees and veterans) receive much larger funeral payments (increased from $800 to $8,800) that are indexed annually for inflation and excluded from gross income, reducing out-of-pocket burdens after a death.
Beneficiaries get clearer, faster payouts because the bill establishes a uniform order of precedence, a signed/witnessed beneficiary form, and requires agencies to pay gratuities from salaries-and-expenses appropriations, reducing disputes and speeding relief.
Taxpayers and the federal budget face higher costs because larger, indexed, and newly tax-exempt death and funeral payments increase federal outlays and reduce revenues, which could raise deficits or crowd out other spending priorities.
Survivors risk delays, disputes, unequal treatment, or denials because willful-misconduct or intoxication exclusions, Secretary of Labor injury determinations, IG findings, and delegated State Department rulemaking for local foreign‑service employees can trigger contested eligibility decisions.
Agencies must pay gratuities from salaries-and-expenses appropriations, which could reduce funds available for agency operations, require reprogramming, or disrupt services if not managed.
Based on analysis of 7 sections of legislative text.
Creates a CPI-indexed $100,000 federal death gratuity, raises funeral pay to $8,800 with COLAs, makes payments tax-exempt, updates beneficiaries, and allows emergency supplemental requests.
Creates a new federal statutory death gratuity program that pays a base benefit of $100,000 (adjusted annually for inflation) to survivors of covered Federal employees who die from work-related injuries, criminal acts, terrorism, natural disasters, or other agency-determined circumstances, with certain exclusions. The bill also raises the federal funeral expense payment from $800 to $8,800 with automatic annual cost-of-living adjustments, makes multiple death-related payments non-taxable, updates beneficiary rules for Foreign Service and Armed Forces–connected deaths, expands coverage to specified FAA, TSA, and certain VA health employees, and authorizes emergency supplemental appropriations when agencies face extraordinary costs for these payments. Survivors and families of fallen federal employees would see larger, inflation-indexed lump-sum payments and broader eligibility; federal agencies would have new payment obligations, offset rules, and potential needs for supplemental appropriations; several statutory provisions across Titles 5, 10, and 22 are amended and prior authority is repealed to consolidate benefits and tax treatment.
Introduced May 9, 2025 by Gerald E. Connolly · Last progress May 9, 2025