[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5366 Enrolled Bill (ENR)]
H.R.5366
One Hundred Nineteenth Congress
of the
United States of America
AT THE SECOND SESSION
Begun and held at the City of Washington on Saturday,
the third day of January, two thousand and twenty-six
An Act
To amend the Internal Revenue Code of 1986 to codify and extend the
rules for personal casualty losses arising from major disasters and the
rules for the exclusion from gross income of compensation for losses or
damages resulting from certain wildfires.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Doug LaMalfa Federal Disaster Tax
Relief Certainty Act''.
SEC. 2. CODIFICATION AND EXTENSION OF RULES FOR CASUALTY LOSSES ARISING
FROM MAJOR DISASTERS.
(a) In General.--Section 165(h) of the Internal Revenue Code of
1986 is amended by adding at the end the following new paragraph:
``(6) Special rule for qualified net disaster losses.--
``(A) In general.--If an individual has a qualified net
disaster loss for any taxable year, the amount determined under
paragraph (2)(A)(ii) shall be the sum of--
``(i) such qualified net disaster loss, and
``(ii) so much of the excess referred to in the matter
preceding clause (i) of paragraph (2)(A) (reduced by the
amount in clause (i) of this subparagraph) as exceeds 10
percent of the adjusted gross income of the individual.
``(B) Qualified net disaster loss.--For purposes of
subparagraph (A), the term `qualified net disaster loss' means
the excess (if any) of--
``(i) qualified disaster-related personal casualty
losses, over
``(ii) personal casualty gains reduced by the portion
of such gains taken into account under paragraph (5)(B)(i).
``(C) Qualified disaster-related personal casualty
losses.--For purposes of this paragraph--
``(i) In general.--The term `qualified disaster-related
personal casualty losses' means losses described in
subsection (c)(3) (determined after application of
paragraph (1)) which arise in a qualified disaster area on
or after the first day of the incident period of the
qualified disaster to which such area relates, and which
are attributable to such disaster.
``(ii) Qualified disaster area.--The term `qualified
disaster area' means any area with respect to which a major
disaster has been declared by the President under section
401 of the Robert T. Stafford Disaster Relief and Emergency
Assistance Act if the incident period of the disaster with
respect to which such declaration is made begins on or
after December 28, 2019, and before January 1, 2027.
``(iii) Qualified disaster.--The term `qualified
disaster' means, with respect to any qualified disaster
area, the disaster by reason of which a major disaster was
declared with respect to such area.
``(iv) Incident period.--The term `incident period'
means, with respect to any qualified disaster, the period
specified by the Federal Emergency Management Agency as the
period during which such disaster occurred.''.
(b) Dollar Limitation.--Section 165(h)(1) of such Code is amended
by striking ``$500 ($100 for taxable years beginning after December 31,
2009)'' and inserting ``$100 ($500 in the case of any qualified
disaster-related personal casualty losses (as defined in paragraph
(6)(C))''.
(c) Deduction Allowed to Individuals Who Do Not Elect to Itemize
Deductions.--Section 63(b) of such Code is amended--
(1) by striking ``and'' at the end of paragraph (6) and
inserting a comma,
(2) by striking the period at the end of paragraph (7) and
inserting ``, and'', and
(3) by adding at the end the following new paragraph:
``(8) so much of the deduction allowed by section 165(a) as is
attributable to the qualified net disaster loss (as defined in
section 165(h)(6)(B)).''.
(d) Effective Date.--
(1) In general.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2024.
(2) Coordination with superceded provisions.--Section 304(b) of
the Taxpayer Certainty and Disaster Tax Relief Act of 2020
(division EE of Public Law 116-260) and section 70438 of Public Law
119-21 shall not apply to any taxable year beginning after December
31, 2024.
SEC. 3. CODIFICATION AND EXTENSION OF EXCLUSION FROM GROSS INCOME OF
COMPENSATION FOR LOSSES OR DAMAGES RESULTING FROM CERTAIN WILDFIRES.
(a) In General.--Part III of subchapter B of chapter 1 of the
Internal Revenue Code of 1986 is amended by inserting before section
140 the following new section:
``SEC. 139M. COMPENSATION FOR LOSSES OR DAMAGES RESULTING FROM CERTAIN
WILDFIRES.
``(a) In General.--Gross income shall not include any amount
received by an individual as a qualified wildfire relief payment.
``(b) Qualified Wildfire Relief Payment.--For purposes of this
section--
``(1) In general.--The term `qualified wildfire relief payment'
means any amount received by or on behalf of an individual as
compensation for losses, expenses, or damages (including
compensation for additional living expenses, lost wages (other than
compensation for lost wages paid by the employer which would have
otherwise paid such wages), personal injury, death, or emotional
distress) incurred as a result of a qualified wildfire disaster,
but only to the extent the losses, expenses, or damages compensated
by such payment are not compensated for by insurance or otherwise.
``(2) Qualified wildfire disaster.--The term `qualified
wildfire disaster' means any Federally declared disaster (as
defined in section 165(i)(5)(A)) declared after December 31, 2014,
and before January 1, 2027, as a result of any forest or range
fire.
``(c) Denial of Double Benefit.--Notwithstanding any other
provision of this title--
``(1) no deduction or credit shall be allowed (to the
individual for whose benefit a qualified wildfire relief payment is
made) for, or by reason of, any expenditure to the extent of the
amount excluded under this section with respect to such
expenditure, and
``(2) no increase in the basis or adjusted basis of any
property shall result from any amount excluded under this section
with respect to such property.''.
(b) Clerical Amendment.--The table of sections for part III of
subchapter B of chapter 1 of such Code is amended by inserting before
the item related to section 140 the following new item:
``Sec. 139M. Compensation for losses or damages resulting from certain
wildfires.''.
(c) Effective Date.--The amendments made by this section shall
apply to payments received in taxable years beginning after December
31, 2025.
Speaker of the House of Representatives.
Vice President of the United States and
President of the Senate.