Overview
Title
To amend the Internal Revenue Code of 1986 to exclude from gross income certain compensation to clinical trial participants.
ELI5 AI
H.R. 7090 is a bill that says when people get money for being part of medical studies, those payments won't be taxed like normal income. This means they don't have to count that money when figuring out how much they owe in taxes.
Summary AI
H.R. 7090 aims to change the Internal Revenue Code of 1986 to ensure that certain payments received by individuals for participating in approved clinical trials are not counted as part of their taxable income. Specifically, this bill excludes payment or reimbursement for participation in approved clinical trials, including expenses for meals, lodging, and travel, from being considered gross income. The changes would apply to money received for these purposes after December 31, 2023.
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AnalysisAI
Summary of the Bill
H.R. 7090 proposes changes to the Internal Revenue Code of 1986. The primary focus of the bill is to provide a tax exclusion for compensation given to individuals participating in clinical trials. This compensation can include payments or reimbursements for expenses such as meals, lodging, and travel incurred during participation. If enacted, the changes will apply to payments made after December 31, 2023.
Significant Issues
One of the major concerns with this bill is the reliance on the definition of "approved clinical trial" as outlined in section 2709(d)(1) of the Public Health Service Act. If this definition changes or if the statute is repealed, it could lead to confusion regarding what qualifies as an "approved" clinical trial.
Additionally, the bill lacks specificity in defining what constitutes "payment or reimbursement." This could result in varying interpretations by different parties and the potential misuse of the tax exclusion. Furthermore, the bill does not mention any oversight or auditing measures to ensure the legitimacy of the payments tied to clinical trial participation. Without clear guidelines or oversight, there is room for financial discrepancies and misuse of funds.
Moreover, while the bill specifies that expenses like meals, lodging, and travel are included, it does not provide limitations or detailed criteria for these expenses, creating the potential for broad interpretations.
Impact on the Public
For the general public, this bill could lower financial barriers for individuals who wish to participate in clinical trials by making participation more financially appealing. By excluding compensation for participation from taxable income, clinical trial participants may have less tax burden, potentially making participation in these trials more accessible and attractive.
Impact on Stakeholders
Clinical Trial Participants: This bill could positively impact individuals participating in clinical trials by easing the financial burden, specifically through tax savings on their compensation. It may encourage more people to engage in needed clinical research by making it more economically viable.
Healthcare and Research Institutions: These stakeholders might experience an increase in willing participants, potentially leading to a faster and more efficient process in conducting crucial clinical trials. However, if the terms and conditions of reimbursement are not clear, they may also face uncertainty and administrative challenges in applying the tax exclusion properly.
Tax Authorities: There may be challenges in implementing and monitoring the newly introduced tax exclusion, primarily if the definitions involved remain ambiguous and oversight measures are not established. Authorities might need to develop new mechanisms to ensure compliance and prevent misuse.
Overall, while aiming to reduce financial disincentives for participating in clinical trials, the bill requires further clarification and oversight to prevent unintended issues, such as misinterpretation and misuse, which could undermine its goals.
Issues
The definition of 'approved clinical trial' is dependent on another statute (section 2709(d)(1) of the Public Health Service Act), which could lead to ambiguity and future complications if that statute is amended or repealed. [Sections 1, 139J]
The bill does not clarify what 'payment or reimbursement' constitutes, which can result in varying interpretations and potential misuse of the exclusion. [Section 1]
There is a lack of oversight measures mentioned in the bill to ensure payments are legitimate and strictly related to clinical trial participation, which raises concerns about potential misuse. [Sections 1, 139J]
No details are provided on limits or criteria for reimbursable expenses, potentially allowing for broad interpretations and misuse, as only meals, lodging, and travel expenses are explicitly mentioned. [Section 139J]
The bill text uses technical language referencing specific United States Code sections without further explanation, which may be difficult for individuals without a legal or healthcare background to understand. [Section 139J]
There is no guidance on how the exclusion applies if participants incur expenses greater than what is reimbursed by clinical trial payments, which might lead to financial discrepancies for participants. [Section 1]
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Exclusion of compensation provided to participants in clinical trials Read Opens in new tab
Summary AI
Under the new law, money received by individuals participating in approved clinical trials, including payments for travel, meals, and lodging, will not be counted as income starting after December 31, 2023. This means they won't have to pay income tax on these amounts.
139J. Clinical trial payments Read Opens in new tab
Summary AI
Gross income will not include money received by a person for taking part in an approved clinical trial, which covers payments for things like meals and travel expenses. An "approved clinical trial" is defined by the Public Health Service Act.