I 
119TH CONGRESS 
1ST SESSION H. R. 1849 
To amend the Internal Revenue Code of 1986 to provide for the exclusion 
from gross income of amounts received from State-based catastrophe 
loss mitigation programs. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 5, 2025 
Mr. LAMALFA (for himself, Mr. THOMPSON of California, Mr. MURPHY, Ms. 
BROWNLEY, Mr. ROUZER, Mr. DAVIS of Illinois, Mr. FITZGERALD, Ms. 
PETTERSEN, Mr. HIGGINS of Louisiana, Mr. PETERS, Mr. MULLIN, Ms. 
CHU, Ms. SEWELL, and Mr. VALADAO) introduced the following bill; 
which was referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
for the exclusion from gross income of amounts received 
from State-based catastrophe loss mitigation programs. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Disaster Mitigation 
and Tax Parity Act of 2025’’. 
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SEC. 2. EXCLUSION OF AMOUNTS RECEIVED FROM STATE- 
BASED 
CATASTROPHE 
LOSS 
MITIGATION 
PROGRAMS. 
(a) IN GENERAL.—Section 139 of the Internal Rev-
enue Code of 1986 is amended by redesignating subsection 
(h) as subsection (i) and by inserting after subsection (g) 
the following new subsection: 
‘‘(h) STATE-BASED CATASTROPHE LOSS MITIGATION 
PROGRAMS.— 
‘‘(1) IN GENERAL.—Gross income shall not in-
clude any amount received by or paid for the benefit 
of an individual as a qualified catastrophe mitigation 
payment under a program established by— 
‘‘(A) a State or any political subdivision or 
public instrumentality thereof, 
‘‘(B) a joint powers authority, or 
‘‘(C) an entity created by State law to en-
sure the availability of an adequate market of 
last resort for essential property insurance or 
basic property insurance, over which a State 
agency or State department of insurance has 
regulatory oversight, 
for the purpose of making such payments. 
‘‘(2) QUALIFIED
CATASTROPHE
MITIGATION 
PAYMENT.—For purposes of this section, the term 
‘qualified catastrophe mitigation payment’ means 
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any amount which is received by or paid for the ben-
efit of the owner of any property to make improve-
ments to such property for the sole purpose of re-
ducing the damage that would be done to such prop-
erty by a windstorm, earthquake, or wildfire. 
‘‘(3) NO INCREASE IN BASIS.—Rules similar to 
the rules of subsection (g)(3) shall apply in the case 
of this subsection.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 139(d) of the Internal Revenue 
Code of 1986 is amended by striking ‘‘and qualified’’ 
and inserting ‘‘, qualified catastrophe mitigation 
payments, and qualified’’. 
(2) Section 139(i) of such Code (as redesig-
nated by subsection (a)) is amended by striking ‘‘or 
qualified’’ and inserting ‘‘, qualified catastrophe 
mitigation payment, or qualified’’. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—The amendments made by 
this section shall apply to taxable years beginning 
after December 31, 2020. 
(2) RETROACTIVE
APPLICABILITY.—The Sec-
retary of the Treasury, or the Secretary’s delegate, 
shall provide an opportunity for individuals to claim 
the exclusion from gross income under section 
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