The Senate has passed the Federal Disaster Tax Relief Act of 2023 (H.R. 5863).
If enacted, the bill would:
- Exclude from gross income qualified wildfire relief payments paid to individuals as compensation (other than insurance payments) for losses, expenses, or damages for any wildfire declared a federal disaster after December 31, 2014 (§3, H.R. 5863);
- Treat disaster relief payments to victims of the East Palestine, Ohio, train derailment as excludable IRC §139(b) payments (§3, H.R. 5863); and
- Allow individual victims with a net disaster loss from any taxable year to claim an enhanced personal casualty loss under IRC §165(h) for certain federally declared disasters that occurred after February 24, 2021. (§2, H.R. 5863)
The bill previously passed the House and will now be sent to the President. It is expected that President Biden will sign the bill.
The text of the bill is available at:
www.congress.gov/bill/118th-congress/house-bill/5863/text
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