A bill to provide tax relief to persons whose property was destroyed or damaged as the result of the collapse of the Teton Dam.

Excludes all compensation received for property damaged as a result of the Teton Dam disaster in Idaho from gross income for income tax purposes. Subtracts such compensation from the adjusted basis of the damaged property.

Provides for the nonrecognition of gain on sales of property which lost at least 50 percent of its market value as a result of the disaster when sold within two years by persons who owned the property at the time of the disaster.

Exempts a taxpayer from any recapture of investment tax credits previously taken on property disposed of as a result of the Teton Dam disaster.