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To amend the Internal Revenue Code of 1986 to allow individuals to avoid a penalty for failure to pay income tax by timely paying 125 percent of the income tax liability for the prior year.
Summary
This bill modifies federal tax law to allow individuals to avoid penalties for failure to pay income tax on time if they timely pay an amount equal to 125 percent of their prior year's income tax liability. The exemption applies only if the individual files their return by the deadline and had filed a return for the prior year. For joint returns, both spouses' prior year tax liabilities count toward the 125 percent threshold. The exemption does not apply if the prior year was less than 12 months long. The changes take effect for taxable years beginning after December 31, 2024.
AI-generated plain-language summary of the bill text — neutral, and may be imperfect. See the full text below for the exact wording.
Sponsor (1)
- Rep. Chu, Judy [D-CA-28] (D-CA)
1 cosponsor
- Rep. Carey, Mike [R-OH-15] (R-OH)
Money behind the sponsor
Top reported contributors to Judy Chu’s campaign committee (2024 cycle) — who funds the bill’s sponsor, not a claim about this bill. Data from FEC.
- NULL $39,775
- MEBO INTERNATIONAL $13,200
- GARFIELD HEALTH CENTER $12,800
- APEX GLOBAL GROUPS INC $9,900
- EDI MEDIA $9,900
Organizations whose employees gave the most — itemized individual contributions grouped by the donor’s reported employer (FEC Schedule A). Full finance for Judy Chu → · Outside spending →
Actions (2)
- Feb 5, 2025 Referred to the House Committee on Ways and Means. · house
- Feb 5, 2025 Introduced in House
Similar bills (6)
Bills with similar text or summary — includes reintroductions across Congresses. Ranked by semantic similarity of the bill text (computed locally); a neutral discovery aid, not a claim the bills are duplicates.
Full text
IN THE HOUSE OF REPRESENTATIVES
February 5, 2025
Ms. Chu (for herself and Mr. Carey) introduced the following bill; which was referred to the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to allow individuals to avoid a penalty for failure to pay income tax by timely paying 125 percent of the income tax liability for the prior year.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the “Simplify Automatic Filing Extensions Act” or the “SAFE Act”.
SEC. 2. NO PENALTY FOR FAILURE TO PAY INCOME TAX FOR INDIVIDUALS WHO TIMELY PAY 125 PERCENT OF INCOME TAX LIABILITY FOR PRIOR YEAR.
(a) In General.—Section 6651(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:
“(3) No penalty for failure to pay income tax for individuals who timely pay 125 percent of income tax liability for prior year.—
“(A) In general.—Subsection (a)(2) shall not apply with respect to an income tax return of an individual if such individual pays, on or before the date prescribed for the payment of the tax with respect to which such return relates (determined with regard to any extension of time for payment), 125 percent of the amount of tax required to be shown on the income tax return of such individual for the immediately preceding taxable year.
“(B) Failure to file; short taxable years.— Subparagraph (A) shall not apply—
“(i) if the individual does not file an income tax return for the taxable year described in subparagraph (A) on or before the date prescribed therefor (determined with regard to any extension of time for filing),
“(ii) if the individual did not file an income tax return for the immediately preceding taxable year referred to in subparagraph (A), or
“(iii) if the immediately preceding taxable year referred to in subparagraph (A) was less than 12 months.
“(C) Joint returns.—In the case of a joint return, if the taxpayer did not file a joint return for the immediately preceding taxable year referred to in subparagraph (A), the amounts required to be shown on the income tax returns of both spouses for such immediately preceding taxable year shall be taken into account under subparagraph (A). Except as otherwise provided by the Secretary, if the individual does not file a joint return for the taxable year to which subparagraph (A) applies and filed a joint return for the immediately preceding taxable year, the entire amount of tax required to be shown on such joint return shall be taken into account under subparagraph (A).
“(D) Exception not applicable unless additional payments are made with timely filed return.— Subparagraph (A) shall not apply with respect to any period beginning after the earlier of—
“(i) the date prescribed for filing the income tax return for the taxable year (including extensions thereof), or
“(ii) the date on which such return was filed.”.
(b) Conforming Amendment.—The heading of section 6651(c) of such Code is amended by striking “Rule” and inserting “Rules”.
(c) Effective Date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2024. <all>
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