Doug LaMalfa Federal Disaster Tax Relief Certainty Act

H.R. 5366, the Federal Disaster Tax Relief Act of 2025 (also referred to as the Doug LaMalfa Federal Disaster Tax Relief Certainty Act), would amend the Internal Revenue Code to permanently codify tax rules that have previously been extended on a temporary, disaster-by-disaster basis. It changes how individuals calculate personal casualty loss deductions for losses from federally declared major disasters occurring between July 4, 2025 and January 1, 2027, lowering the per-casualty dollar floor and removing the requirement that such losses exceed 10% of adjusted gross income to be deductible, including for people who take the standard deduction. It also creates a permanent exclusion from taxable income for wildfire relief payments (covering losses, living expenses, lost wages, injury, or emotional distress) received for federally declared wildfire disasters after 2014, for payments received in taxable years 2026 through 2030.

The bill affects individual taxpayers who experience losses from major disasters or wildfires, allowing more of their losses to be deducted or excluded from income, and simplifying rules that previously required separate legislation after each disaster.

Introduced in the House on 2025-09-15 by Rep. Steube, it has passed both the House and Senate, with the Senate passing it without amendment by unanimous consent on 2026-08-07. It next goes to the President for signature or veto before it could become law.

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