TBA Law Blog


Posted by: Stacey Shrader Joslin on Jul 3, 2025

Prior to passage of President Donald Trump’s massive policy and budget bill by the U.S. Senate, the parliamentarian struck a proposed tax on litigation financiers. The provision, championed by retiring Republican Sen. Thom Tillis of North Carolina, would have imposed a 40.8% tax rate on all "qualified litigation proceeds" received by any third party through a litigation financing agreement. It met strong opposition from the industry, which argued the tax would chill investment and undermine access to justice, Reuters reports. According to litigation finance firm Westfleet Advisors, there are now more than 42 active funders managing a total of $16.1 billion in assets. The industry continues to face other challenges, including calls for greater transparency from the business community, state regulations and federal legislation that would require civil litigants to disclose any litigation funding agreements.