S. 3817 — Stop Presidential Embezzlement Act

This section establishes a new chapter 50B in subtitle D of the Internal Revenue Code imposing a tax equal to 100% of qualified civil action amounts received during a taxable year by covered persons. Covered persons include any individual who has served as President, Vice President, in a position at level I of the Executive Schedule under 5 U.S.C. 5312 (i.e., cabinet secretaries and certain other senior executive positions such as the U.S. Trade Representative and Director of National Intelligence), or as a Member of Congress (including Delegates and Resident Commissioners), as well as any person related to such an individual under IRC §267(b); qualified civil action amounts are damages received (by settlement, verdict, judgment, or otherwise) from any civil action filed by the covered person against the United States (or an agency or instrumentality thereof) if the filing or settlement/verdict/judgment occurred during the applicable period (i.e., beginning on the date the relevant individual began serving as President and ending on the date such individual ceased serving as President). The section further excludes such amounts from gross income under chapter 1, denies any income tax deduction for the tax under new IRC §275(a)(6), and makes conforming clerical amendments to the table of chapters for subtitle D; the amendments apply to amounts received after enactment.