Doug LaMalfa Protect Innocent Victims of Taxation After Fire Extension Act

The bill would add a new section 139M to the Internal Revenue Code excluding from gross income any compensation an individual receives for losses, expenses, or damages from a federally declared wildfire disaster declared after December 31, 2014, to the extent not covered by insurance or other sources. The exclusion covers items such as additional living expenses, lost wages (other than employer-paid wages that would otherwise have been paid), personal injury, death, and emotional distress. It also bars double benefits, meaning no deduction, credit, or basis increase may arise from excluded amounts, and the exclusion sunsets for amounts received after December 31, 2032, with effect for amounts received after December 31, 2025.

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