26 U.S. Code § 139M - Compensation for losses or damages resulting from certain wildfires

(a) In general

Gross income shall not include any amount received by an individual as a qualified wildfire relief payment.

(b) Qualified wildfire relief payment

For purposes of this section—

(1) In general

The term “qualified wildfire relief payment” means any amount received by or on behalf of an individual as compensation for losses, expenses, or damages (including compensation for additional living expenses, lost wages (other than compensation for lost wages paid by the employer which would have otherwise paid such wages), personal injury, death, or emotional distress) incurred as a result of a qualified wildfire disaster, but only to the extent the losses, expenses, or damages compensated by such payment are not compensated for by insurance or otherwise.

(2) Qualified wildfire disaster

The term “qualified wildfire disaster” means any Federally [1] declared disaster (as defined in section 165(i)(5)(A)) declared after December 31, 2014, and before January 1, 2027, as a result of any forest or range fire.

(c) Denial of double benefit

Notwithstanding any other provision of this title—

(1) no deduction or credit shall be allowed (to the individual for whose benefit a qualified wildfire relief payment is made) for, or by reason of, any expenditure to the extent of the amount excluded under this section with respect to such expenditure, and

(2) no increase in the basis or adjusted basis of any property shall result from any amount excluded under this section with respect to such property.

(Added Pub. L. 119–108, § 3(a), Sept. 11, 2026, 140 Stat. 1020.)

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[1]  So in original. Probably should not be capitalized.

Statutory Notes and Related Subsidiaries

Effective Date

Pub. L. 119–108, § 3(c), Sept. 11, 2026, 140 Stat. 1021, provided that:

“The amendments made by this section [enacting this section] shall apply to payments received in taxable years beginning after December 31, 2025.”