Sponsors (2)
The bill significantly strengthens and expands tax-free, inflation‑protected death and burial benefits for federal employees and veterans—giving survivors clearer, larger support—while increasing federal costs, shifting agency budgets, and creating administrative and eligibility complexities that may delay or reduce payments for some families.
Surviving families of federal employees and veterans will receive larger, guaranteed lump-sum death and burial payments that are indexed for inflation, improving predictable financial support after a work-related death.
More frontline and public-safety personnel (e.g., FAA employees, certain TSA appointees, VHA staff) and deaths abroad are explicitly covered (with some provisions made retroactive), extending survivor benefits to more workers and families.
All covered death gratuities and the increased burial payments are excluded from federal gross income, so recipients keep the full benefit without owing federal income tax.
The combination of larger indexed payments and tax exclusions increases federal outlays and reduces receipts, raising budgetary pressure and the potential for higher deficits or the need for offsets.
Agencies must fund gratuities from their salaries-and-expenses appropriations and face increased administrative liabilities and implementation costs, which can reduce funds available for agency programs and operations.
Net payments to survivors can be reduced because the new gratuities must be offset by other U.S.-funded program payments (in many cases), lowering the actual benefit families receive if they qualify for multiple programs.
Based on analysis of 7 sections of legislative text.
Establishes a $100,000 base federal death gratuity (CPI‑indexed), raises funeral pay to $8,800 (indexed), makes payments tax-exempt, expands eligibility, and authorizes emergency supplements.
Introduced May 9, 2025 by Gerald E. Connolly · Last progress May 9, 2025
Creates a permanent federal employee death gratuity program that pays a standard, inflation-adjusted cash benefit when a federal employee dies from work-connected injuries, criminal acts, terrorism, natural disaster, or other agency-determined circumstances (except deaths from willful misconduct, intentional self-harm, or intoxication). It sets the base gratuity at $100,000 (with annual CPI adjustments), raises the flat funeral expense payment to $8,800 (also indexed), aligns tax treatment so these payments are excluded from gross income, expands and clarifies eligibility for Foreign Service and other covered personnel, and authorizes emergency supplemental appropriations for agencies when mass incidents or disasters create costs beyond available funds. The measure also updates related federal statutes to standardize beneficiary order, require offset of duplicate federal benefits in many cases, preserve the Secretary of Labor’s authority to define covered employees, and apply the tax exclusion to several existing death-payment authorities. Most changes apply to deaths occurring on or after enactment.