On January 16, Congress Member La Malfa reported that the new tax framework package agreed to by the House Ways and Means Committee and the Senate Committee on Finance includes the Protect Innocent Victims of Taxation After Fire Act (H.R. 4970). Co-authored by Congressmen Doug LaMalfa (R-Richvale) and Mike Thompson (D-St. Helena), H.R. 4970 excludes from gross income, for income tax purposes, any amount received after 2019 and before 2026 by an individual taxpayer as a qualified wildfire relief payment. The payment is defined as compensation for expenses or losses incurred by a federally declared forest or range fire disaster. This includes a tax exemption for emotional distress, lost wages, legal fees, and additional living expenses. The new package is expected to pass quickly, now that there is an agreement between the House and the Senate. A summary of the full tax bill is available here.
