H.R. 5366 — Doug LaMalfa Federal Disaster Tax Relief Certainty Act

This section codifies and extends through December 31, 2026, a special rule allowing individuals to deduct qualified net disaster losses from major disasters declared after December 28, 2019, by reducing the 10-percent-of-AGI floor by the full amount of such losses. It lowers the per-casualty floor to $100 generally and sets it at $500 for qualified disaster-related personal casualty losses. It also permits an above-the-line deduction for the qualified net disaster loss portion for taxpayers who do not itemize. The rules apply to taxable years beginning after December 31, 2024, and supersede prior temporary disaster relief provisions.

This section excludes from gross income qualified wildfire relief payments received by individuals for losses, expenses, or damages (including additional living expenses, lost wages, personal injury, death, or emotional distress) from qualified wildfire disasters. It applies to payments received in taxable years beginning after December 31, 2025, covers federally declared forest or range fire disasters declared after December 31, 2014, and before January 1, 2027, and denies related deductions, credits, or basis increases.