Protect Innocent Victims of Taxation After Fire Extension Act
Rep. LaMalfa Introduces Bipartisan Bill to End Federal Taxes on Wildfire Relief Payments
This bill is currently in the early stages of the legislative process and is being reviewed by the House Committee on Ways and Means. No further actions are scheduled at this time, and the bill is not moving forward. There is no companion bill listed for this legislation.
Part of: story →Passage Likelihood
Legislative Progress
Key Points
- This bill would stop the federal government from taxing money that wildfire victims receive to help them recover. Relief payments for things like home repairs, temporary housing, lost wages, personal injuries, and emotional distress would all be excluded from taxable income.
From policy text
“Gross income shall not include any amount received by an individual as a qualified wildfire relief payment.”
View in full text - To qualify for the tax break, the wildfire must have been officially declared a federal disaster after December 31, 2014. This means victims of major wildfires over the past decade, including the devastating 2025 Los Angeles fires, could benefit.
From policy text
“The term `qualified wildfire disaster' means any federally declared disaster (as defined in section 165(i)(5)(A)) declared, after December 31, 2014, as a result of any forest or range fire.”
View in full text - The tax exclusion only applies to losses not already covered by insurance. Victims also cannot claim a tax deduction or credit for the same expenses that were paid for with tax-free relief money, preventing a double benefit.
From policy text
“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”
View in full text - If passed, the new tax rules would apply to payments received after December 31, 2025, and would expire at the end of 2032, giving wildfire victims a seven-year window of tax relief.
From policy text
“The amendments made by this section shall apply to amounts received after December 31, 2025.”
View in full text - The bill has bipartisan support, introduced by Republican Rep. LaMalfa along with both Republican and Democratic cosponsors from California, Oregon, and Utah, all states with significant wildfire risk.
From policy text
“Mr. LaMalfa (for himself, Mr. Thompson of California, Mr. McClintock, Mr. Sherman, Mr. Bentz, Ms. Bynum, and Mr. Moore of Utah) introduced the following bill”
View in full text
Impact Analysis
Personal Impact
State Impacts
Milestones
Referred to the House Committee on Ways and Means.
Introduced in House
The bill was officially filed and given a number. It now enters the legislative queue.
Related News
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Lawmakers introduce bill to keep wildfire survivor aid tax-free through 2032
Rep. Doug LaMalfa introduced the bipartisan Protect Innocent Victims of Taxation After Fire Extension Act to extend the Federal Disaster Tax Relief Act. The bill would ensure that payments for living expenses, lost wages, and personal injury remain tax-exempt through 2032.
LaMalfa Introduces Bipartisan Protect Innocent Victims of Taxation After Fire Extension Act
Congressman Doug LaMalfa introduced H.R. 5225 to provide long-term certainty for wildfire victims. The bill allows survivors to claim tax exemptions in the year they receive payments, eliminating the need to file amended returns for past disasters dating back to 2014.
After months of delays tax bill for fire survivors is moving forward
Coverage of the original 'Protect Innocent Victims of Taxation After Fire Act' as it moved through the House Ways and Means Committee. Survivors of the Camp Fire advocated for the bill to avoid paying 20% to 30% of their settlement payments in federal taxes.
Source Information
Document Type
Congressional Bill
Official Title
Protect Innocent Victims of Taxation After Fire Extension Act
Data Sources
Sponsor
Cosponsors
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