S.3587

Exempts interest paid to taxpayers by the IRS following an audit or litigation from gross income.

The No Tax on Wrongful Delay Act of 2026 amends the Internal Revenue Code to exempt interest paid to taxpayers by the Internal Revenue Service following an audit or litigation from gross income. This applies to interest paid after December 31, 2025, in cases where the taxpayer prevailed. The bill introduces a new section, 139M, to the Internal Revenue Code to reflect this exemption.