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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 140 Introduced in House (IH)]

<DOC>

119th CONGRESS
  1st Session
                                H. R. 140

  To provide tax relief for damages relating to Hurricanes Helene and 
                                Milton.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                            January 3, 2025

 Mr. Buchanan introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL

 
  To provide tax relief for damages relating to Hurricanes Helene and 
                                Milton.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Hurricane Helene 
and Milton Tax Relief Act of 2025''.
    (b) Table of Contents.--

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Earned income credit determined based on preceding taxable year 
                            income with respect to qualified hurricane 
                            disaster areas.
Sec. 4. Increased limitation on charitable contributions for qualified 
                            hurricane disaster relief; certain 
                            contributions paid before April 15, 2025, 
                            treated as paid in 2024.
Sec. 5. Special hurricane disaster-related rules for use of retirement 
                            funds.

SEC. 2. DEFINITIONS.

    For purposes of this Act--
     (a) Eligible Individual.--The term ``eligible individual'' means 
an individual whose principal place of abode at any time during the 
incident period is located in the qualified hurricane disaster area and 
who has sustained an economic loss by reason of Hurricane Helene or 
Hurricane Milton.
    (b) Qualified Hurricane Disaster Area.--The term ``qualified 
hurricane disaster area'' means an area with respect to which a major 
disaster has been declared by the President (before the date of the 
enactment of this Act) under section 401 of the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act by reason of Hurricane 
Helene or Hurricane Milton.
    (c) Incident Period.--The term ``incident period'' means the period 
beginning on September 28, 2024, and ending on November 2, 2024.

SEC. 3. EARNED INCOME CREDIT DETERMINED BASED ON PRECEDING TAXABLE YEAR 
              INCOME WITH RESPECT TO QUALIFIED HURRICANE DISASTER 
              AREAS.

    (a) In General.--In the case of an eligible individual, if the 
earned income of the taxpayer for the applicable taxable year is less 
than the earned income of the taxpayer for the preceding taxable year, 
the credit allowed under section 32 of the Internal Revenue Code of 
1986 for the applicable taxable year may, at the election of the 
taxpayer, be determined by substituting--
            (1) such earned income for the preceding taxable year, for
            (2) such earned income for the applicable taxable year.
    (b) Applicable Tax Year.--For purposes of this section, the term 
``applicable taxable year'' means any taxable year which includes any 
portion of the incident period.
    (c) Earned Income.--For purposes of this section, the term ``earned 
income'' has the meaning given such term under section 32(c) of such 
Code.
    (d) Special Rules.--
            (1) Application to joint returns.--For purposes of 
        subsection (a), in the case of a joint return for an applicable 
        taxable year--
                    (A) such subsection shall apply if either spouse is 
                an eligible individual, and
                    (B) the earned income of the taxpayer for the 
                preceding taxable year shall be the sum of the earned 
                income of each spouse for such preceding taxable year.
            (2) Errors treated as mathematical error.--For purposes of 
        section 6213 of such Code, an incorrect use on a return of 
        earned income pursuant to subsection (a) shall be treated as a 
        mathematical or clerical error.
            (3) No effect on determination of gross income, etc.--
        Except as otherwise provided in this section, such Code shall 
        be applied without regard to any substitution under subsection 
        (a).
            (4) Limitation to single taxable year.--No taxpayer may 
        make an election under subsection (a) if such taxpayer (or in 
        the case of a joint return, the taxpayer's spouse) made such an 
        election for any preceding taxable year.

SEC. 4. INCREASED LIMITATION ON CHARITABLE CONTRIBUTIONS FOR QUALIFIED 
              HURRICANE DISASTER RELIEF; CERTAIN CONTRIBUTIONS PAID 
              BEFORE APRIL 15, 2025, TREATED AS PAID IN 2024.

    (a) Qualified Hurricane Disaster Contributions.--
            (1) Individuals.--In the case of any qualified hurricane 
        disaster contribution, notwithstanding section 170(b) of such 
        Code, the total amount of such contributions which may be taken 
        into account under section 170(a) of such Code shall not exceed 
        the excess of--
                    (A) the taxpayer's contribution base, over
                    (B) the amount of all other charitable 
                contributions allowable under section 170(b)(1) of such 
                Code.
            (2) Carryover.--
                    (A) In general.--If the aggregate amount of 
                contributions described in paragraph (1) exceeds the 
                limitation under such paragraph, such excess shall be 
                treated (in a manner consistent with the rules of 
                subsection 170(d)(1) of such Code) as a charitable 
                contribution to which paragraph (1) applies in each of 
                the 5 succeeding years in order of time.
                    (B) Coordination with deduction for charitable 
                contributions.--For purposes of applying this paragraph 
                and sections 170(b)(1)(G) and 170(d)(1) of such Code, 
                contributions described in paragraph (1) shall not be 
                treated as described in subparagraph (A) or (G) of 
                section 170(b)(1) of such Code and such subparagraphs 
                shall be applied without regard to such contributions.
            (3) Application of election to partnerships and s 
        corporations.--In the case of a partnership or S corporation, 
        the election under subsection (e)(3)(A)(iii) shall be made 
        separately by each partner or shareholder.
    (b) Corporations.--
            (1) In general.--In the case of any qualified hurricane 
        disaster contribution, notwithstanding section 170(b) of such 
        Code, the total amount of such contributions which may be taken 
        into account under section 170(a) of such Code shall not exceed 
        the excess of--
                    (A) 20 percent of the taxpayer's taxable income, 
                over
                    (B) the amount of charitable contributions allowed 
                under section 170(b)(2)(A) of such Code.
            (2) Carryover.--If the aggregate amount of contributions 
        described in paragraph (1) exceeds the limitation under such 
        paragraph, such excess shall be treated (in a manner consistent 
        with the rules of section 170(d)(1) of such Code) as a 
        charitable contribution to which paragraph (1) applies in each 
        of the 5 succeeding years in order of time.
            (3) Coordination with deduction for charitable 
        contributions.--For purposes of applying this paragraph and 
        sections 170(b)(2) of such Code, contributions described in 
        paragraph (1) shall not be treated as described in subparagraph 
        (A), (B), or (C) of section 170(b)(2) of such Code and such 
        subparagraphs shall be applied without regard to such 
        contributions.
    (c) Deduction Allowed Above the Line.--In the case of an 
individual--
            (1) the standard deduction otherwise determined under 
        section 63 of such Code shall be increased by so much of the 
        deduction allowed under section 170 of such Code as would not 
        be so allowed if determined without regard to this section, and
            (2) section 56(b)(1)(D) of such Code shall not apply to so 
        much of the standard deduction as is attributable to the 
        increase under paragraph (1).
    (d) Contributions Treated as Made in Prior Year.--For purposes of 
this section, a taxpayer may treat any qualified hurricane disaster 
contribution which is paid after December 31, 2024, and on or before 
April 15, 2025, as if such contribution was made on December 31, 2024, 
and not in 2025.
    (e) Definitions.--For purposes of this section--
            (1) Charitable contribution.--The term ``charitable 
        contribution'' has the meaning given such term in section 
        170(c) of such Code.
            (2) Contribution base.--The term ``contribution base'' has 
        the meaning given such term in section 170(b)(1)(H) of such 
        Code.
            (3) Qualified hurricane disaster contribution.--
                    (A) In general.--The term ``qualified hurricane 
                disaster contribution'' means any charitable 
                contribution if--
                            (i) such contribution--
                                    (I) is paid on or after the first 
                                day of the incident period and before 
                                December 31, 2025, in cash to an 
                                organization described in section 
                                170(b)(1)(A) of such Code, and
                                    (II) is made for relief efforts in 
                                a qualified hurricane disaster area 
                                related to Hurricane Helene or 
                                Hurricane Milton,
                            (ii) the taxpayer obtains from such 
                        organization contemporaneous written 
                        acknowledgment (within the meaning of section 
                        170(f)(8) of such Code) that such contribution 
                        was used (or is to be used) for relief efforts 
                        in a qualified hurricane disaster area related 
                        to Hurricane Helene or Hurricane Milton, and
                            (iii) the taxpayer has elected the 
                        application of this section with respect to 
                        such contribution.
                    (B) Exception.--A qualified hurricane disaster 
                contribution shall not include a contribution by a 
                donor if the contribution is--
                            (i) to an organization described in section 
                        509(a)(3) of such Code, or
                            (ii) for establishment of a new, or 
                        maintenance of an existing, donor advised fund 
                        (as defined in section 4966(d)(2) of such 
                        Code).

SEC. 5. SPECIAL HURRICANE DISASTER-RELATED RULES FOR USE OF RETIREMENT 
              FUNDS.

    (a) Tax-Favored Withdrawals From Retirement Plans.--
            (1) In general.--Section 72(t) of the Internal Revenue Code 
        of 1986 shall not apply to any qualified hurricane disaster 
        distribution.
            (2) Aggregate dollar limitation.--
                    (A) In general.--For purposes of this subsection, 
                the aggregate amount of distributions received by an 
                individual which may be treated as qualified hurricane 
                disaster distributions for any taxable year shall not 
                exceed the excess (if any) of--
                            (i) $100,000, over
                            (ii) the aggregate amounts treated as 
                        qualified hurricane disaster distributions 
                        received by such individual for all prior 
                        taxable years.
                    (B) Treatment of plan distributions.--If a 
                distribution to an individual would (without regard to 
                subparagraph (A)) be a qualified hurricane disaster 
                distribution, a plan shall not be treated as violating 
                any requirement of such Code merely because the plan 
                treats such distribution as a qualified hurricane 
                disaster distribution, unless the aggregate amount of 
                such distributions from all plans maintained by the 
                employer (and any member of any controlled group which 
                includes the employer) to such individual exceeds 
                $100,000.
                    (C) Controlled group.--For purposes of subparagraph 
                (B), the term ``controlled group'' means any group 
                treated as a single employer under subsection (b), (c), 
                (m), or (o) of section 414 of such Code.
            (3) Amount distributed may be repaid.--
                    (A) In general.--Any individual who receives a 
                qualified hurricane disaster distribution may, at any 
                time during the 3-year period beginning on the day 
                after the date on which such distribution was received, 
                make 1 or more contributions in an aggregate amount not 
                to exceed the amount of such distribution to an 
                eligible retirement plan of which such individual is a 
                beneficiary and to which a rollover contribution of 
                such distribution could be made under section 402(c), 
                403(a)(4), 403(b)(8), 408(d)(3), or 457(e)(16), of such 
                Code, as the case may be.
                    (B) Treatment of repayments of distributions from 
                eligible retirement plans other than iras.--For 
                purposes of such Code, if a contribution is made 
                pursuant to subparagraph (A) with respect to a 
                qualified hurricane disaster distribution from an 
                eligible retirement plan other than an individual 
                retirement plan, then the taxpayer shall, to the extent 
                of the amount of the contribution, be treated as having 
                received the qualified hurricane disaster distribution 
                in an eligible rollover distribution (as defined in 
                section 402(c)(4) of such Code) and as having 
                transferred the amount to the eligible retirement plan 
                in a direct trustee to trustee transfer within 60 days 
                of the distribution.
                    (C) Treatment of repayments of distributions from 
                iras.--For purposes of such Code, if a contribution is 
                made pursuant to subparagraph (A) with respect to a 
                qualified hurricane disaster distribution from an 
                individual retirement plan (as defined by section 
                7701(a)(37) of such Code), then, to the extent of the 
                amount of the contribution, the qualified hurricane 
                disaster distribution shall be treated as a 
                distribution described in section 408(d)(3) of such 
                Code and as having been transferred to the eligible 
                retirement plan in a direct trustee to trustee transfer 
                within 60 days of the distribution.
            (4) Definitions.--For purposes of this subsection--
                    (A) Qualified hurricane disaster distribution.--
                Except as provided in paragraph (2), the term 
                ``qualified hurricane disaster distribution'' means any 
                distribution from an eligible retirement plan made--
                            (i) on or after the first day of the 
                        incident period and before December 31, 2025, 
                        and
                            (ii) to an eligible individual.
                    (B) Eligible retirement plan.--The term ``eligible 
                retirement plan'' shall have the meaning given such 
                term by section 402(c)(8)(B) of such Code.
            (5) Income inclusion spread over 3-year period.--
                    (A) In general.--In the case of any qualified 
                hurricane disaster distribution, unless the taxpayer 
                elects not to have this paragraph apply for any taxable 
                year, any amount required to be included in gross 
                income for such taxable year shall be so included 
                ratably over the 3-taxable-year period beginning with 
                such taxable year.
                    (B) Special rule.--For purposes of subparagraph 
                (A), rules similar to the rules of section 
                408A(d)(3)(E) of such Code shall apply.
            (6) Special rules.--
                    (A) Exemption of distributions from trustee to 
                trustee transfer and withholding rules.--For purposes 
                of sections 401(a)(31), 402(f), and 3405 of such Code, 
                qualified hurricane disaster distributions shall not be 
                treated as eligible rollover distributions.
                    (B) Qualified hurricane disaster distributions 
                treated as meeting plan distribution requirements.--For 
                purposes of such Code, a qualified hurricane disaster 
                distribution shall be treated as meeting the 
                requirements of sections 401(k)(2)(B)(i), 
                403(b)(7)(A)(i), 403(b)(11), and 457(d)(1)(A) of such 
                Code and section 8433(h)(1) of title 5, United States 
                Code, and, in the case of a money purchase pension 
                plan, a qualified hurricane disaster distribution which 
                is an in-service withdrawal shall be treated as meeting 
                the distribution rules of section 401(a) of such Code.
    (b) Recontributions of Withdrawals for Home Purchases.--
            (1) Recontributions.--
                    (A) In general.--Any individual who received a 
                qualified distribution may, during the applicable 
                period, make 1 or more contributions in an aggregate 
                amount not to exceed the amount of such qualified 
                distribution to an eligible retirement plan (as defined 
                in section 402(c)(8)(B) of such Code) of which such 
                individual is a beneficiary and to which a rollover 
                contribution of such distribution could be made under 
                section 402(c), 403(a)(4), 403(b)(8), or 408(d)(3), of 
                such Code, as the case may be.
                    (B) Treatment of repayments.--Rules similar to the 
                rules of subparagraphs (B) and (C) of subsection (a)(3) 
                shall apply for purposes of this subsection.
            (2) Qualified distribution.--For purposes of this 
        subsection, the term ``qualified distribution'' means any 
        distribution--
                    (A) described in section 401(k)(2)(B)(i)(IV), 
                403(b)(7)(A)(i)(V), 403(b)(11)(B), or 72(t)(2)(F), of 
                such Code,
                    (B) which was to be used to purchase or construct a 
                principal residence in a qualified hurricane disaster 
                area, but which was not so used on account of Hurricane 
                Helene or Hurricane Milton, and
                    (C) which was received during the period beginning 
                on the date which is 180 days before the first day of 
                the incident period and ending on the date which is 30 
                days after the last day of such incident period.
            (3) Applicable period.--For purposes of this subsection, 
        the term ``applicable period'' means, in the case of a 
        principal residence in a qualified hurricane disaster area, the 
        period beginning on the first day of the incident period and 
        ending on December 31, 2025.
    (c) Loans From Qualified Plans.--
            (1) Increase in limit on loans not treated as 
        distributions.--In the case of any loan from a qualified 
        employer plan (as defined under section 72(p)(4) of such Code) 
        to an eligible individual made during the period beginning on 
        the date of the enactment of this Act and ending on June 30, 
        2025--
                    (A) section 72(p)(2)(A)(i) of such Code shall be 
                applied by substituting `` $100,000'' for `` $50,000'', 
                and
                    (B) clause (ii) of such section shall be applied by 
                substituting ``the present value of the nonforfeitable 
                accrued benefit of the employee under the plan'' for 
                ``one-half of the present value of the nonforfeitable 
                accrued benefit of the employee under the plan''.
            (2) Delay of repayment.--In the case of an eligible 
        individual with an outstanding loan (on or after the first day 
        of the incident period) from a qualified employer plan (as 
        defined in section 72(p)(4) of such Code)--
                    (A) if the due date pursuant to subparagraph (B) or 
                (C) of section 72(p)(2) of such Code for any repayment 
                with respect to such loan occurs during the period 
                beginning on the first day of the incident period and 
                ending on the date which is 180 days after the last day 
                of such incident period, such due date shall be delayed 
                for 1 year (or, if later, until December 31, 2025),
                    (B) any subsequent repayments with respect to any 
                such loan shall be appropriately adjusted to reflect 
                the delay in the due date under subparagraph (A) and 
                any interest accruing during such delay, and
                    (C) in determining the 5-year period and the term 
                of a loan under subparagraph (B) or (C) of section 
                72(p)(2) of such Code, the period described in 
                subparagraph (A) of this paragraph shall be 
                disregarded.
    (d) Provisions Relating to Plan Amendments.--
            (1) In general.--If this subsection applies to any 
        amendment to any plan or annuity contract, such plan or 
        contract shall be treated as being operated in accordance with 
        the terms of the plan during the period described in paragraph 
        (2)(B)(i).
            (2) Amendments to which subsection applies.--
                    (A) In general.--This subsection shall apply to any 
                amendment to any plan or annuity contract which is 
                made--
                            (i) pursuant to any provision of this 
                        section, or pursuant to any regulation issued 
                        by the Secretary or the Secretary of Labor 
                        under any provision of this section, and
                            (ii) on or before the last day of the first 
                        plan year beginning on or after January 1, 
                        2025, or such later date as the Secretary may 
                        prescribe.
                In the case of a governmental plan (as defined in 
                section 414(d) of such Code), clause (ii) shall be 
                applied by substituting the date which is 2 years after 
                the date otherwise applied under clause (ii).
                    (B) Conditions.--This subsection shall not apply to 
                any amendment unless--
                            (i) during the period--
                                    (I) beginning on the date that this 
                                section or the regulation described in 
                                subparagraph (A)(i) takes effect (or in 
                                the case of a plan or contract 
                                amendment not required by this section 
                                or such regulation, the effective date 
                                specified by the plan), and
                                    (II) ending on the date described 
                                in subparagraph (A)(ii) (or, if 
                                earlier, the date the plan or contract 
                                amendment is adopted),
                the plan or contract is operated as if such plan or 
                contract amendment were in effect, and
                            (ii) such plan or contract amendment 
                        applies retroactively for such period.
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