THOMPSON, PADILLA RELEASE UPDATE ON DISASTER VICTIMS TAX RELIEF LEGISLATION

Washington - Today, Representative Mike Thompson (CA-04) and Senator Alex Padilla (D-CA) released the below statement at the start of the House and Senate's October district work period:

"The Bipartisan Federal Disaster Tax Relief Act remains a priority for both of us. We continue to work closely together to get this passed into law.

"We will continue to do all we can to ensure this bill will be brought up for a vote and passed by the Senate in the lame duck session following this November's elections.

"The pending legislation includes a provision to make this relief retroactive, so all qualified wildfire victims will be able to benefit. Our teams will continue to keep Californians updated regarding this legislation."

Background

The Federal Disaster Tax Relief Act passed the House in May and would retroactively exempt thousands of qualified wildfire victims in California, including PG&E fire victims, from having to pay federal income tax on their settlement money or pay tax on attorney fees that are included in the settlement.

It also excludes from taxpayer gross income, for income tax purposes, relief payments for losses resulting from the East Palestine, Ohio, train derailment on February 3, 2023 and designates Hurricane Ian, among other federally declared disasters, as a qualified disaster for the purposes of determining the tax treatment of certain disaster-related personal casualty losses.