“A bill to amend the Internal Revenue Code of 1986 to provide a credit against tax for disaster mitigation expenditures.”
No CRS summary available for this bill.
This section establishes a nonrefundable personal tax credit equal to 25% of qualified disaster mitigation expenditures made by an individual taxpayer with respect to a qualified dwelling unit. The annual credit is capped at $3,750 ($7,500 for joint returns), with a lifetime cap of $15,000 per dwelling unit for credits claimed after December 31, 2025; the credit phases out for adjusted gross income over $100,000 ($200,000 for joint returns), with thresholds inflation-adjusted after 2026 using 2025 as the base year. Qualified expenditures include specified costs to improve a dwelling unit's resistance to natural hazards such as wind, flood, wildfire, earthquake, and lightning (e.g., roof deck attachments, secondary water barriers, flood vents, ignition-resistant materials, storm shelters, and automatic shutoff valves).
This section establishes a nonrefundable tax credit under IRC §38 equal to 25% of qualified disaster mitigation expenditures (i.e., costs to retrofit a place of business against natural hazards, as defined under IRC §25G(c)(1) but applied to businesses rather than residences) made during the taxable year, up to $5,000 (phased out for taxpayers with average annual gross receipts over $5 million, inflation-adjusted after 2026), for taxable years beginning after December 31, 2025. The place of business must be located in the United States or a U.S. territory in an area that (1) had a federal disaster declaration within the prior five years, (2) is adjacent to such an area, (3) received FEMA hazard mitigation assistance for a relevant natural disaster, or (4) is designated as a community disaster resilience zone under 42 U.S.C. §5136(a) (i.e., census tracts with the highest hazard risk ratings based on loss exposure, social vulnerability, and low community resilience).