H.R. 5366
Doug LaMalfa Federal Disaster Tax Relief Certainty Act
Official summary
Written by the Congressional Research Service.
Doug LaMalfa Federal Disaster Tax Relief Certainty Act
This act extends the federal tax deduction for qualified disaster-related personal casualty losses and the exclusion from gross income of qualified wildfire relief payments.
Under current law, unreimbursed personal casualty losses arising in a qualified disaster area (qualified disaster-related personal casualty losses) are deductible (as an itemized tax deduction or as part of the standard tax deduction) if such losses exceed $500 per casualty. A qualified disaster area is an area with respect to which a major disaster has been declared during the period beginning in 2020 and ending 60 days after July 4, 2025, if the incident period begins on or after December 28, 2019, and on or before July 4, 2025.
The act extends the federal tax deduction for qualified disaster-related personal casualty losses by defining a qualified disaster area as an area with respect to which a major disaster has been declared if the incident period begins on or after December 28, 2019, and before January 1, 2027.
The act provides that the exclusion from gross income of qualified wildfire relief payments applies to such payments attributable to forest or range fires declared a federal disaster after 2014 and before 2027, regardless of when such payments are received. (Currently, qualified wildfire relief payments attributable to forest or range fires declared a federal disaster after 2014 and received after 2019 and before 2026 may be excluded from gross income.)
The act also provides statutory authority for several related tax rules.
Text of the bill
Where this section came from
-
Sep 15, 2025 · Introduced in House Referred to House Committee on Ways and Means, Sep 15
-
Apr 9, 2026 · Reported in House Marked up by House Committee on Ways and Means, Mar 25 Reported by House Committee on Ways and Means, Apr 9 Committee members' individual votes aren't in our records.
… 4 unchanged passages …
(b)
Definitions;
Qualified
qualified
wildfire relief payment. For purposes of this section—
… 1 unchanged passage …
(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
person
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.
(d) Limitation on application. This section shall only apply to qualified wildfire relief payments received by the individual during taxable years beginning after December 31, 2025, and before January 1, 2031.
… 6 unchanged passages …
What is a markup?
A markup is a committee meeting where members go through a bill and vote on changes before sending it to the full chamber.
(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:
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.