Catalyzes the formation of isethionate from 2-sulfoacetaldehyde in the deaminative pathway of taurine. The enzyme is specific for NADPH; NADH is not a substrate. 2-hydroxyethane-1-sulfonate + NADP(+) = H(+) + NADPH + sulfoacetaldehyde Organosulfur degradation. Homodimer and heterotetramer. Belongs to the short-chain dehydrogenases/reductases (SDR) family.