SECTION 1. SHORT TITLE, ETC. 
(a) IN GENERAL.—This Act may be cited as the 
‘‘Disaster Tax Relief Act of 2008’’. 
(b) REFERENCE.—Except as otherwise expressly pro-
vided, whenever in this Act an amendment or repeal is 
expressed in terms of an amendment to, or repeal of, a 
section or other provision, the reference shall be consid-
ered to be made to a section or other provision of the In-
ternal Revenue Code of 1986. 
(c) TABLE OF CONTENTS.—The table of contents of 
this Act is as follows: 
Sec. 1. Short title, etc. 
Sec. 2. Losses attributable to federally declared disasters. 
Sec. 3. Expensing of qualified disaster expenses. 
Sec. 4. Net operating losses attributable to federally declared disasters. 
Sec. 5. Waiver of certain mortgage revenue bond requirements following feder-
ally declared disasters. 
Sec. 6. Determination of standard mileage rate for charitable contributions de-
duction. 
Sec. 7. Additional low income housing allocations. 
Sec. 8. Private activity disaster bonds. 
Sec. 9. Waiver of limitation on charitable contributions for disaster relief. 
SEC. 2. LOSSES ATTRIBUTABLE TO FEDERALLY DECLARED 
DISASTERS. 
(a) WAIVER OF ADJUSTED GROSS INCOME LIMITA-
TION.— 
(1) IN
GENERAL.—Subsection (h) of section 
165 is amended by redesignating paragraphs (3) and 
(4) as paragraphs (4) and (5), respectively, and by 
inserting after paragraph (2) the following new 
paragraph:
‘‘(3) SPECIAL RULE FOR LOSSES IN FEDERALLY 
DECLARED DISASTERS.— 
‘‘(A) IN GENERAL.—If an individual has a 
net disaster loss for any taxable year, the 
amount determined under paragraph (2)(A)(ii) 
shall be the sum of— 
‘‘(i) such net disaster loss, and 
‘‘(ii) so much of the excess referred to 
in the matter preceding clause (i) of para-
graph (2)(A) (reduced by the amount in 
clause (i) of this subparagraph) as exceeds 
10 percent of the adjusted gross income of 
the individual. 
‘‘(B) NET DISASTER LOSS.—For purposes 
of subparagraph (A), the term ‘net disaster 
loss’ means the excess of— 
‘‘(i) the personal casualty losses— 
‘‘(I) attributable to a federally 
declared disaster occurring after De-
cember 31, 2007, and before January 
1, 2012, and 
‘‘(II) occurring in a disaster 
area, over 
‘‘(ii) personal casualty gains.
‘‘(C) FEDERALLY DECLARED DISASTER.— 
For purposes of this paragraph— 
‘‘(i) 
FEDERALLY
DECLARED
DIS-
ASTER.—The term ‘federally declared dis-
aster’ means any disaster subsequently de-
termined by the President of the United 
States to warrant assistance by the Fed-
eral Government under the Robert T. Staf-
ford Disaster Relief and Emergency Assist-
ance Act. 
‘‘(ii) DISASTER AREA.—The term ‘dis-
aster area’ means the area so determined 
to warrant such assistance.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 165(h)(4)(B) (as so redesig-
nated) is amended by striking ‘‘paragraph (2)’’ 
and inserting ‘‘paragraphs (2) and (3)’’. 
(B) Section 165(i)(1) is amended by strik-
ing ‘‘loss’’ and all that follows through ‘‘Act’’ 
and inserting ‘‘loss occurring in a disaster area 
(as defined by clause (ii) of subsection 
(h)(3)(C)) and attributable to a federally de-
clared disaster (as defined by clause (i) of such 
subsection)’’.
(C) Section 165(i)(4) is amended by strik-
ing ‘‘Presidentially declared disaster (as defined 
by section 1033(h)(3))’’ and inserting ‘‘federally 
declared disaster (as defined by subsection 
(h)(3)(C)(i)’’. 
(D)(i) So much of subsection (h) of section 
1033 as precedes subparagraph (A) of para-
graph (1) thereof is amended to read as follows: 
‘‘(h) SPECIAL RULES FOR PROPERTY DAMAGED BY 
FEDERALLY DECLARED DISASTERS.— 
‘‘(1) PRINCIPAL
RESIDENCES.—If the tax-
payer’s principal residence or any of its contents is 
located in a disaster area and is compulsorily or in-
voluntarily converted as a result of a federally de-
clared disaster—’’. 
(ii) Paragraph (2) of section 1033(h) is 
amended by striking ‘‘investment’’ and all that 
follows through ‘‘disaster’’ and inserting ‘‘in-
vestment is located in a disaster area and is 
compulsorily or involuntarily converted as a re-
sult of a federally declared disaster’’. 
(iii) Paragraph (3) of section 1033(h) is 
amended to read as follows: 
‘‘(3) FEDERALLY
DECLARED
DISASTER; DIS-
ASTER
AREA.—The terms ‘‘federally declared dis-
aster’’ and ‘‘disaster area’’ shall have the respective 
meaning given such terms by section 165(h)(3)(C).’’. 
(iv) Section 139(c)(2) is amended to read 
as follows: 
‘‘(2) federally declared disaster (as defined by 
section 165(h)(3)(C)(i)),’’. 
(v) 
Subclause 
(II) 
of 
section 
172(b)(1)(F)(ii) is amended by striking ‘‘Presi-
dentially declared disasters (as defined in sec-
tion 1033(h)(3))’’ and inserting ‘‘federally de-
clared 
disasters 
(as 
defined 
by 
section 
165(h)(3)(C)(i))’’. 
(vi) 
Subclause 
(III) 
of 
section 
172(b)(1)(F)(ii) is amended by striking ‘‘Presi-
dentially declared disasters’’ and inserting ‘‘fed-
erally declared disasters’’. 
(vii) Subsection (a) of section 7508A is 
amended by striking ‘‘Presidentially declared 
disaster (as defined in section 1033(h)(3))’’ and 
inserting ‘‘federally declared disaster (as de-
fined by section 165(h)(3)(C)(i))’’. 
(b) INCREASE IN STANDARD DEDUCTION BY DIS-
ASTER CASUALTY LOSS.— 
(1) IN
GENERAL.—Paragraph (1) of section 
63(c) is amended by striking ‘‘and’’ at the end of
subparagraph (B), by striking the period at the end 
of subparagraph (C) and inserting ‘‘, and’’, and by 
adding at the end the following new subparagraph: 
‘‘(D) the disaster loss deduction.’’. 
(2) DISASTER
LOSS
DEDUCTION.—Subsection 
(c) of section 63 is amended by adding at the end 
the following new paragraph: 
‘‘(8) DISASTER
LOSS
DEDUCTION.—For the 
purposes of paragraph (1), the term ‘disaster loss 
deduction’ means the net disaster loss (as defined in 
section 165(h)(3)(B)).’’. 
(3) ALLOWANCE IN COMPUTING ALTERNATIVE 
MINIMUM TAXABLE INCOME.—Subparagraph (E) of 
section 56(b)(1) is amended by adding at the end 
the following new sentence: ‘‘The preceding sentence 
shall not apply to so much of the standard deduction 
as is determined under section 63(c)(1)(D).’’. 
(c) INCREASE IN LIMITATION ON INDIVIDUAL LOSS 
PER CASUALTY.—Paragraph (1) of section 165(h) is 
amended by striking ‘‘$100’’ and inserting ‘‘$500 ($100 
for taxable years beginning after December 31, 2011)’’. 
(d) EFFECTIVE DATES.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section 
shall apply to—
(A) taxable years beginning after Decem-
ber 31, 2007, and 
(B) the taxpayer’s last taxable year begin-
ning before January 1, 2008, solely for pur-
poses of determining the amount allowable as a 
deduction with respect to any net disaster loss 
(as defined in section 165(h)(3)(B) of the In-
ternal Revenue Code of 1986) for such year by 
reason of an election under section 165(i) of 
such Code. 
(2) INCREASE IN LIMITATION ON INDIVIDUAL 
LOSS
PER
CASUALTY.—The amendment made by 
subsection (c) shall apply to taxable years beginning 
after December 31, 2008. 
SEC. 3. EXPENSING OF QUALIFIED DISASTER EXPENSES. 
(a) IN GENERAL.—Part VI of subchapter B of chap-
ter 1 is amended by inserting after section 198 the fol-
lowing new section: 
‘‘SEC. 198A. EXPENSING OF QUALIFIED DISASTER EX-
PENSES. 
‘‘(a) IN GENERAL.—A taxpayer may elect to treat 
any qualified disaster expenses which are paid or incurred 
by the taxpayer as an expense which is not chargeable to 
capital account. Any expense which is so treated shall be
allowed as a deduction for the taxable year in which it 
is paid or incurred. 
‘‘(b) QUALIFIED DISASTER EXPENSE.—For purposes 
of this section, the term ‘qualified disaster expense’ means 
any expenditure— 
‘‘(1) which is paid or incurred in connection 
with a trade or business or with business-related 
property, 
‘‘(2) which is— 
‘‘(A) for the abatement or control of haz-
ardous substances that were released on ac-
count of a federally declared disaster, 
‘‘(B) for the removal of debris from, or the 
demolition of structures on, real property which 
is business-related property damaged or de-
stroyed as a result of a federally declared dis-
aster, or 
‘‘(C) for the repair of business-related 
property damaged as a result of a federally de-
clared disaster, and 
‘‘(3) is otherwise chargeable to capital account. 
‘‘(c) OTHER DEFINITIONS.—For purposes of this 
section— 
‘‘(1) 
BUSINESS-RELATED
PROPERTY.—The 
term ‘business-related property’ means property—
‘‘(A) held by the taxpayer for use in a 
trade or business or for the production of in-
come, or 
‘‘(B) described in section 1221(a)(1) in the 
hands of the taxpayer. 
‘‘(2) FEDERALLY
DECLARED
DISASTER.—The 
term ‘federally declared disaster’ has the meaning 
given such term by section 165(h)(3)(C)(i), except 
that such term shall not include any disaster occur-
ring before January 1, 2008, or after December 31, 
2011. 
‘‘(d) DEDUCTION RECAPTURED AS ORDINARY IN-
COME
ON SALE, ETC.—Solely for purposes of section 
1245, in the case of property to which a qualified disaster 
expense would have been capitalized but for this section— 
‘‘(1) the deduction allowed by this section for 
such expense shall be treated as a deduction for de-
preciation, and 
‘‘(2) such property (if not otherwise section 
1245 property) shall be treated as section 1245 
property solely for purposes of applying section 1245 
to such deduction. 
‘‘(e) COORDINATION WITH OTHER PROVISIONS.— 
Sections 198, 280B, and 468 shall not apply to amounts 
which are treated as expenses under this section.
‘‘(f) REGULATIONS.—The Secretary shall prescribe 
such regulations as may be necessary or appropriate to 
carry out the purposes of this section.’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
for part VI of subchapter B of chapter 1 is amended by 
inserting after the item relating to section 198 the fol-
lowing new item: 
‘‘Sec. 198A. Expensing of Qualified Disaster Expenses.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to amounts paid or incurred after 
December 31, 2007. 
SEC. 4. NET OPERATING LOSSES ATTRIBUTABLE TO FED-
ERALLY DECLARED DISASTERS. 
(a) IN GENERAL.—Paragraph (1) of section 172(b) 
is amended by adding at the end the following new sub-
paragraph: 
‘‘(J) CERTAIN
LOSSES
ATTRIBUTABLE 
FEDERALLY
DECLARED
DISASTERS.—In the 
case of a taxpayer who has a qualified disaster 
loss (as defined in subsection (j)), such loss 
shall be a net operating loss carryback to each 
of the 5 taxable years preceding the taxable 
year of such loss.’’. 
(b) QUALIFIED DISASTER LOSS.—Section 172 is 
amended by redesignating subsections (j) and (k) as sub-