Tackling Predatory Litigation Funding Act

This bill imposes a new tax on entities receiving funding for civil lawsuits through litigation financing agreements. It requires a 3.8% surcharge (added to regular income tax rates) on profits from such funding, applied at the entity level for businesses like partnerships. The tax applies to third parties (e.g., corporations, individuals) who receive funds for lawsuits but excludes small agreements under $10,000 and standard loans with interest capped at 7% or 2x Treasury rates. The tax takes effect for 2026 taxable years, with 50% of the tax withheld directly from settlement payments.