[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 1366 Introduced in Senate (IS)]







105th CONGRESS
  1st Session
                                S. 1366

To amend the Internal Revenue Code of 1986 to eliminate the 10 percent 
                 floor for deductible disaster losses.


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                   IN THE SENATE OF THE UNITED STATES

                            November 4, 1997

Mr. Kerrey (for himself and Mr. Conrad) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to eliminate the 10 percent 
                 floor for deductible disaster losses.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. ELIMINATION OF 10 PERCENT FLOOR FOR DEDUCTIBLE DISASTER 
              LOSSES.

    (a) General Rule.--Section 165(h)(2)(A) of the Internal Revenue 
Code of 1986 (relating to net casualty loss allowed only to the extent 
it exceeds 10 percent of adjusted gross income) is amended by striking 
clauses (i) and (ii) and inserting the following new clauses:
                            ``(i) the amount of the personal casualty 
                        gains for the taxable year,
                            ``(ii) the amount of the federally declared 
                        disaster losses for the taxable year (or, if 
                        lesser, the net casualty loss), plus
                            ``(iii) the portion of the net casualty 
                        loss which is not deductible under clause (ii) 
                        but only to the extent such portion exceeds 10 
                        percent of the adjusted gross income of the 
                        individual.
                For purposes of the preceding sentence, the term `net 
                casualty loss' means the excess of personal casualty 
                losses for the taxable year over personal casualty 
                gains.''.
    (b) Federally Declared Disaster Loss Defined.--Section 165(h)(3) of 
such Code (defining personal casualty gain and personal casualty loss) 
is amended--
            (1) by adding at the end the following new subparagraph:
                    ``(C) Federally declared disaster loss.--
                            ``(i) In general.--The term `federally 
                        declared disaster loss' means any personal 
                        casualty loss attributable to a disaster 
                        occurring during 1997 in an area subsequently 
                        determined by the President of the United 
                        States to warrant assistance by the Federal 
                        Government under the Robert T. Stafford 
                        Disaster Relief and Emergency Assistance Act.
                            ``(ii) Dollar limitation.--Such term shall 
                        not include personal casualty losses to the 
                        extent such losses exceed $10,000 for the 
                        taxable year.'', and
            (2) by striking ``of personal casualty gain and personal 
        casualty loss'' in the heading.
    (c) Conforming Amendment.--The heading for section 165(h)(2) of 
such Code is amended by striking ``Net casualty loss'' and inserting 
``Net nondisaster casualty loss''.
    (d) Effective Date.--The amendments made by this section shall 
apply to losses attributable to disasters occurring after December 31, 
1996, including for purposes of determining the portion of such losses 
allowable in taxable years ending before such date pursuant to an 
election under section 165(i) of the Internal Revenue Code of 1986.
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