Disaster Mitigation and Tax Parity Act of 2025
This bill excludes from gross income, for federal income tax purposes, payments received from a state catastrophe loss mitigation program by an individual for the purpose of making improvements to the individual’s property that mitigate the impact of certain disasters.
Under current law, individuals may exclude from gross income, for federal income tax purposes, payments received under the Robert T. Stafford Disaster Relief and Emergency Assistance Act or the National Flood Insurance Act (as in effect on April 15, 2005) for hazard mitigation. (Some exceptions apply.) Further, under current law, such payments do not increase the basis of the property for which the payments are made.
The bill allows a similar exclusion from gross income for certain payments received by an individual from a program established by
Under the bill, such payments must be for making improvements to the individual’s property for the sole purpose of reducing damage that would be done to the property by a windstorm, earthquake, flood, or wildfire.
Finally, the bill provides that such payments from a state catastrophe loss mitigation program do not increase the basis of the property for which the payments are made.
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1849 Introduced in House (IH)]
<DOC>
119th CONGRESS
1st Session
H. R. 1849
To amend the Internal Revenue Code of 1986 to provide for the exclusion
from gross income of amounts received from State-based catastrophe loss
mitigation programs.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 5, 2025
Mr. LaMalfa (for himself, Mr. Thompson of California, Mr. Murphy, Ms.
Brownley, Mr. Rouzer, Mr. Davis of Illinois, Mr. Fitzgerald, Ms.
Pettersen, Mr. Higgins of Louisiana, Mr. Peters, Mr. Mullin, Ms. Chu,
Ms. Sewell, and Mr. Valadao) introduced the following bill; which was
referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide for the exclusion
from gross income of amounts received from State-based catastrophe loss
mitigation programs.
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 ``Disaster Mitigation and Tax Parity
Act of 2025''.
SEC. 2. EXCLUSION OF AMOUNTS RECEIVED FROM STATE-BASED CATASTROPHE LOSS
MITIGATION PROGRAMS.
(a) In General.--Section 139 of the Internal Revenue Code of 1986
is amended by redesignating subsection (h) as subsection (i) and by
inserting after subsection (g) the following new subsection:
``(h) State-Based Catastrophe Loss Mitigation Programs.--
``(1) In general.--Gross income shall not include any
amount received by or paid for the benefit of an individual as
a qualified catastrophe mitigation payment under a program
established by--
``(A) a State or any political subdivision or
public instrumentality thereof,
``(B) a joint powers authority, or
``(C) an entity created by State law to ensure the
availability of an adequate market of last resort for
essential property insurance or basic property
insurance, over which a State agency or State
department of insurance has regulatory oversight,
for the purpose of making such payments.
``(2) Qualified catastrophe mitigation payment.--For
purposes of this section, the term `qualified catastrophe
mitigation payment' means any amount which is received by or
paid for the benefit of the owner of any property to make
improvements to such property for the sole purpose of reducing
the damage that would be done to such property by a windstorm,
earthquake, or wildfire.
``(3) No increase in basis.--Rules similar to the rules of
subsection (g)(3) shall apply in the case of this
subsection.''.
(b) Conforming Amendments.--
(1) Section 139(d) of the Internal Revenue Code of 1986 is
amended by striking ``and qualified'' and inserting ``,
qualified catastrophe mitigation payments, and qualified''.
(2) Section 139(i) of such Code (as redesignated by
subsection (a)) is amended by striking ``or qualified'' and
inserting ``, qualified catastrophe mitigation payment, or
qualified''.
(c) Effective Date.--
(1) In general.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2020.
(2) Retroactive applicability.--The Secretary of the
Treasury, or the Secretary's delegate, shall provide an
opportunity for individuals to claim the exclusion from gross
income under section 139(h) of the Internal Revenue Code of
1986, as added by this section, including by amended return.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
ASSUMING FIRST SPONSORSHIP - Mr. Murphy asked unanimous consent that he may hereafter be considered as the first sponsor of H.R. 1849, a bill originally introduced by Representative LaMalfa, for the purpose of adding cosponsors and requesting reprintings pursuant to clause 7 of rule XII. Agreed to without objection.
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