Title: Disaster RELIEF Act
Policy area: Taxation

Summary:
Disaster Recovery for Economies, Local Individuals, Employers, and Families Act of 2020 or the Disaster RELIEF Act
This bill provides tax relief measures for individual and business taxpayers in qualified disaster areas during a specified period, other than areas for which a disaster has been declared solely by reason of COVID-19 (i.e., coronavirus disease 2019).
Specifically, the bill provides employers in a disaster area a tax credit designed to retain employees by allowing a credit for 40% of their employee wages, not exceeding $6,000 for each employee. It also allows an enhanced tax deduction for personal casualty losses incurred in a disaster area.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8314 Introduced in House (IH)]

<DOC>






116th CONGRESS
  2d Session
                                H. R. 8314

   To provide with respect to recent disasters an employee retention 
credit for employers affected by such disasters and rules for disaster-
                   related personal casualty losses.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 18, 2020

Ms. Finkenauer introduced the following bill; which was referred to the 
Committee on Ways and Means, and in addition to the Committee on Small 
Business, for a period to be subsequently determined by the Speaker, in 
   each case for consideration of such provisions as fall within the 
                jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
   To provide with respect to recent disasters an employee retention 
credit for employers affected by such disasters and rules for disaster-
                   related personal casualty losses.

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

SECTION 1. SHORT TITLE.

     This Act may be cited as the ``Disaster Recovery for Economies, 
Local Individuals, Employers, and Families Act of 2020'' or the 
``Disaster RELIEF Act''.

SEC. 2. DEFINITIONS.

    For purposes of this Act--
            (1) Qualified disaster area.--
                    (A) In general.--The term ``qualified disaster 
                area'' means any area with respect to which a major 
                disaster was declared, during the period beginning on 
                December 28, 2019, and ending on the date which is 60 
                days after the date of the enactment of this Act, by 
                the President under section 401 of the Robert T. 
                Stafford Disaster Relief and Emergency Assistance Act 
                if the incident period of the disaster with respect to 
                which such declaration is made begins on or before the 
                date of the enactment of this Act.
                    (B) COVID-19 exception.--Such term shall not 
                include any area with respect to which such a major 
                disaster has been so declared only by reason of COVID-
                19.
            (2) Qualified disaster zone.--The term ``qualified disaster 
        zone'' means that portion of any qualified disaster area which 
        was determined by the President, during the period beginning on 
        December 28, 2019, and ending on the date which is 60 days 
        after the date of the enactment of this Act, to warrant 
        individual or individual and public assistance from the Federal 
        Government under the Robert T. Stafford Disaster Relief and 
        Emergency Assistance Act by reason of the qualified disaster 
        with respect to such disaster area.
            (3) Qualified disaster.--The term ``qualified disaster'' 
        means, with respect to any qualified disaster area, the 
        disaster by reason of which a major disaster was declared with 
        respect to such area.
            (4) Incident period.--The term ``incident period'' means, 
        with respect to any qualified disaster, the period specified by 
        the Federal Emergency Management Agency as the period during 
        which such disaster occurred (except that for purposes of this 
        Act such period shall not be treated as beginning before 
        December 28, 2019, or ending after the date which is 30 days 
        after the date of the enactment of this Act).

SEC. 3. EMPLOYEE RETENTION CREDIT FOR EMPLOYERS AFFECTED BY QUALIFIED 
              DISASTERS.

    (a) In General.--For purposes of section 38 of the Internal Revenue 
Code of 1986, in the case of an eligible employer, the 2020 qualified 
disaster employee retention credit shall be treated as a credit listed 
at the end of subsection (b) of such section. For purposes of this 
subsection, the 2020 qualified disaster employee retention credit for 
any taxable year is an amount equal to 40 percent of the qualified 
wages with respect to each eligible employee of such employer for such 
taxable year. The amount of qualified wages with respect to any 
employee which may be taken into account under this subsection by the 
employer for any taxable year shall not exceed $6,000 (reduced by the 
amount of qualified wages with respect to such employee which may be so 
taken into account for any prior taxable year).
    (b) Definitions.--For purposes of this section--
            (1) Eligible employer.--The term ``eligible employer'' 
        means any employer--
                    (A) which conducted an active trade or business in 
                a qualified disaster zone at any time during the 
                incident period of the qualified disaster with respect 
                to such qualified disaster zone, and
                    (B) with respect to whom the trade or business 
                described in subparagraph (A) is inoperable at any time 
                during the period beginning on the first day of the 
                incident period of such qualified disaster and ending 
                on the date of the enactment of this Act, as a result 
                of damage sustained by reason of such qualified 
                disaster.
            (2) Eligible employee.--The term ``eligible employee'' 
        means with respect to an eligible employer an employee whose 
        principal place of employment with such eligible employer 
        (determined immediately before the qualified disaster referred 
        to in paragraph (1)) was in the qualified disaster zone 
        referred to in such paragraph.
            (3) Qualified wages.--The term ``qualified wages'' means 
        wages (as defined in section 51(c)(1) of the Internal Revenue 
        Code of 1986, but without regard to section 3306(b)(2)(B) of 
        such Code) paid or incurred by an eligible employer with 
        respect to an eligible employee at any time on or after the 
        date on which the trade or business described in paragraph (1) 
        first became inoperable at the principal place of employment of 
        the employee (determined immediately before the qualified 
        disaster referred to in such paragraph) and before the earlier 
        of--
                    (A) the date on which such trade or business has 
                resumed significant operations at such principal place 
                of employment, or
                    (B) the date which 150 days after the last day of 
                the incident period of the qualified disaster referred 
                to in paragraph (1).
        Such term shall include wages paid without regard to whether 
        the employee performs no services, performs services at a 
        different place of employment than such principal place of 
        employment, or performs services at such principal place of 
        employment before significant operations have resumed. Such 
        term shall not include any wages taken into account under 
        section 2301 of the Coronavirus Aid, Relief, and Economic 
        Security Act.
    (c) Special Rules.--
            (1) Employee not taken into account more than once.--An 
        employee shall not be treated as an eligible employee for 
        purposes of this subsection for any period with respect to any 
        employer if such employer is allowed a credit under section 51 
        of the Internal Revenue Code of 1986 with respect to such 
        employee for such period.
            (2) Denial of double benefit.--Any wages taken into account 
        in determining the credit allowed under this section shall not 
        be taken into account as wages for purposes of sections 41, 
        45A, 45P, 45S, 51, and 1396 of the Internal Revenue Code of 
        1986.
            (3) Certain other rules to apply.--For purposes of this 
        subsection, rules similar to the rules of sections 51(i)(1), 
        52, and 280C(a), of the Internal Revenue Code of 1986, shall 
        apply.
    (d) Election To Not Take Certain Wages Into Account.--
            (1) In general.--This section shall not apply to qualified 
        wages paid by an eligible employer with respect to which such 
        employer makes an election (at such time and in such manner as 
        the Secretary may prescribe) to have this section not apply to 
        such wages.
            (2) Coordination with paycheck protection program.--The 
        Secretary, in consultation with the Administrator of the Small 
        Business Administration, shall issue guidance providing that 
        payroll costs paid or incurred during the covered period shall 
        not fail to be treated as qualified wages under this section by 
        reason of an election under paragraph (1) to the extent that a 
        covered loan of the eligible employer is not forgiven by reason 
        of a decision under section 1106(g) of the CARES Act. Terms 
        used in the preceding sentence which are also used in section 
        1106 of such Act shall have the same meaning as when used in 
        such section.
    (e) Amendment to Paycheck Protection Program.--Section 1106(a)(8) 
of the CARES Act is amended by inserting ``, except that such costs 
shall not include qualified wages taken into account in determining the 
credit allowed under section 4 of the Disaster RELIEF Act'' before the 
period at the end.

SEC. 4. SPECIAL RULES FOR QUALIFIED DISASTER-RELATED PERSONAL CASUALTY 
              LOSSES.

    (a) In General.--If an individual has a net disaster loss for any 
taxable year--
            (1) the amount determined under section 165(h)(2)(A)(ii) of 
        the Internal Revenue Code of 1986 shall be equal to the sum 
        of--
                    (A) such net disaster loss, and
                    (B) so much of the excess referred to in the matter 
                preceding clause (i) of section 165(h)(2)(A) of such 
                Code (reduced by the amount in subparagraph (A) of this 
                paragraph) as exceeds 10 percent of the adjusted gross 
                income of the individual,
            (2) in the case of qualified disaster-related personal 
        casualty losses, section 165(h)(1) of such Code shall be 
        applied to by substituting ``$500'' for ``$500 ($100 for 
        taxable years beginning after December 31, 2009)'',
            (3) the standard deduction determined under section 63(c) 
        of such Code shall be increased by the net disaster loss, and
            (4) section 56(b)(1)(E) of such Code shall not apply to so 
        much of the standard deduction as is attributable to the 
        increase under paragraph (3) of this paragraph.
    (b) Net Disaster Loss.--For purposes of this section, the term 
``net disaster loss'' means the excess of qualified disaster-related 
personal casualty losses over personal casualty gains (as defined in 
section 165(h)(3)(A) of the Internal Revenue Code of 1986).
    (c) Qualified Disaster-Related Personal Casualty Losses.--For 
purposes of this section, the term ``qualified disaster-related 
personal casualty losses'' means losses described in section 165(c)(3) 
of the Internal Revenue Code of 1986 which arise in a qualified 
disaster area on or after the first day of the incident period of the 
qualified disaster to which such area relates, and which are 
attributable to such qualified disaster.
                                 <all>