Title: Disaster Tax Relief Act of 2021
Policy area: Taxation

Summary:
Disaster Tax Relief Act of 2021
This bill sets forth tax relief provisions for taxpayers residing in a disaster zone. Specifically, the bill

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3954 Introduced in House (IH)]

<DOC>






117th CONGRESS
  1st Session
                                H. R. 3954

  To amend the Internal Revenue Code of 1986 to provide disaster tax 
  relief, exclude from gross income amounts received from State-based 
     catastrophe loss mitigation programs, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 16, 2021

  Mr. Thompson of California introduced the following bill; which was 
  referred to the Committee on Ways and Means, and in addition to the 
   Committees on Small Business, and Agriculture, 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 amend the Internal Revenue Code of 1986 to provide disaster tax 
  relief, exclude from gross income amounts received from State-based 
     catastrophe loss mitigation programs, and for other purposes.

    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 Tax Relief Act of 2021''.

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, 2020, 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, 2020, 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, 2020, or ending after the date which is 30 days 
        after the date of the enactment of this Act).

SEC. 3. SPECIAL 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 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 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 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 disaster distribution, 
                a plan shall not be treated as violating any 
                requirement of the Internal Revenue Code of 1986 merely 
                because the plan treats such distribution as a 
                qualified 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 the Internal Revenue Code 
                of 1986.
                    (D) Special rule for individuals affected by more 
                than one disaster.--The limitation of subparagraph (A) 
                shall be applied separately with respect to 
                distributions made with respect to each qualified 
                disaster.
            (3) Amount distributed may be repaid.--
                    (A) In general.--Any individual who receives a 
                qualified 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 the Internal 
                Revenue Code of 1986, as the case may be.
                    (B) Treatment of repayments of distributions from 
                eligible retirement plans other than iras.--For 
                purposes of the Internal Revenue Code of 1986, if a 
                contribution is made pursuant to subparagraph (A) with 
                respect to a qualified 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 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 the Internal Revenue Code of 
                1986, if a contribution is made pursuant to 
                subparagraph (A) with respect to a qualified 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 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 disaster distribution.--Except as 
                provided in paragraph (2), the term ``qualified 
                disaster distribution'' means any distribution from an 
                eligible retirement plan made--
                            (i) on or after the first day of the 
                        incident period of a qualified disaster and 
                        before the date which is 180 days after the 
                        date of the enactment of this Act, and
                            (ii) to an individual whose principal place 
                        of abode at any time during the incident period 
                        of such qualified disaster is located in the 
                        qualified disaster area with respect to such 
                        qualified disaster and who has sustained an 
                        economic loss by reason of such qualified 
                        disaster.
                    (B) Eligible retirement plan.--The term ``eligible 
                retirement plan'' shall have the meaning given such 
                term by section 402(c)(8)(B) of the Internal Revenue 
                Code of 1986.
            (5) Income inclusion spread over 3-year period.--
                    (A) In general.--In the case of any qualified 
                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 subparagraph (E) of 
                section 408A(d)(3) of the Internal Revenue Code of 1986 
                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 the 
                Internal Revenue Code of 1986, qualified disaster 
                distributions shall not be treated as eligible rollover 
                distributions.
                    (B) Qualified disaster distributions treated as 
                meeting plan distribution requirements.--For purposes 
                the Internal Revenue Code of 1986, a qualified disaster 
                distribution shall be treated as meeting the 
                requirements of sections 401(k)(2)(B)(i), 
                403(b)(7)(A)(ii), 403(b)(11), and 457(d)(1)(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 the Internal Revenue Code of 
                1986) 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)(ii) (but only to the extent such 
                distribution relates to financial hardship), 
                403(b)(11)(B), or 72(t)(2)(F), of the Internal Revenue 
                Code of 1986,
                    (B) which was to be used to purchase or construct a 
                principal residence in a qualified disaster area, but 
                which was not so used on account of the qualified 
                disaster with respect to such area, and
                    (C) which was received during the period beginning 
                on the date which is 180 days before the first day of 
                the incident period of such qualified disaster 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 disaster area with respect 
        to any qualified disaster, the period beginning on the first 
        day of the incident period of such qualified disaster and 
        ending on the date which is 180 days after the date of the 
        enactment of this Act.
    (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 the 
        Internal Revenue Code of 1986) to a qualified individual made 
        during the 180-day period beginning on the date of the 
        enactment of this Act--
                    (A) clause (i) of section 72(p)(2)(A) 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 a qualified 
        individual (with respect to any qualified disaster) with an 
        outstanding loan (on or after the first day of the incident 
        period of such qualified disaster) from a qualified employer 
        plan (as defined in section 72(p)(4) of the Internal Revenue 
        Code of 1986)--
                    (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 of 
                such qualified disaster 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 the date which is 180 days after the date 
                of the enactment of this Act),
                    (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.
            (3) Qualified individual.--For purposes of this subsection, 
        the term ``qualified individual'' means any individual--
                    (A) whose principal place of abode at any time 
                during the incident period of any qualified disaster is 
                located in the qualified disaster area with respect to 
                such qualified disaster, and
                    (B) who has sustained an economic loss by reason of 
                such qualified disaster.
    (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, 
                        2021, or such later date as the Secretary may 
                        prescribe.
                In the case of a governmental plan (as defined in 
                section 414(d) of the Internal Revenue Code of 1986), 
                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.

SEC. 4. 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 2021 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 2021 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 Tax Relief Act of 2021'' 
before the period at the end.

SEC. 5. OTHER DISASTER-RELATED TAX RELIEF PROVISIONS.

    (a) Special Rules for Qualified Disaster Relief Contributions.--
            (1) In general.--In the case of a qualified disaster relief 
        contribution made by a corporation--
                    (A) section 2205(a)(2)(B) of the CARES Act shall be 
                applied first to qualified contributions without regard 
                to any qualified disaster relief contributions and then 
                separately to such qualified disaster relief 
                contribution, and
                    (B) in applying such section to such qualified 
                disaster relief contributions, clause (i) thereof shall 
                be applied--
                            (i) by substituting ``100 percent'' for 
                        ``25 percent'', and
                            (ii) by treating qualified contributions 
                        other than qualified disaster relief 
                        contributions as contributions allowed under 
                        section 170(b)(2) of the Internal Revenue Code 
                        of 1986.
            (2) Qualified disaster relief contribution.--For purposes 
        of this subsection, the term ``qualified disaster relief 
        contribution'' means any qualified contribution (as defined in 
        section 2205(a)(3) of the CARES Act) if--
                    (A) such contribution--
                            (i) is paid, during the period beginning on 
                        December 28, 2020, and ending on the date which 
                        is 60 days after the date of the enactment of 
                        this Act, and
                            (ii) is made for relief efforts in one or 
                        more qualified disaster areas,
                    (B) 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 described in subparagraph (A)(ii), and
                    (C) the taxpayer has elected the application of 
                this subsection with respect to such contribution.
    (b) Special Rules for Qualified Disaster-Related Personal Casualty 
Losses.--
            (1) In general.--If an individual has a net disaster loss 
        for any taxable year--
                    (A) the amount determined under section 
                165(h)(2)(A)(ii) of the Internal Revenue Code of 1986 
                shall be equal to the sum of--
                            (i) such net disaster loss, and
                            (ii) 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 clause (i) of this subparagraph) as 
                        exceeds 10 percent of the adjusted gross income 
                        of the individual,
                    (B) 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)'',
                    (C) the standard deduction determined under section 
                63(c) of such Code shall be increased by the net 
                disaster loss, and
                    (D) 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 subparagraph (C) of 
                this paragraph.
            (2) Net disaster loss.--For purposes of this subsection, 
        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).
            (3) Qualified disaster-related personal casualty losses.--
        For purposes of this subsection, 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.

SEC. 6. TREATMENT OF CERTAIN POSSESSIONS.

    (a) Payments to Possessions With Mirror Code Tax Systems.--The 
Secretary of the Treasury shall pay to each possession of the United 
States which has a mirror code tax system amounts equal to the loss (if 
any) to that possession by reason of the application of the provisions 
of this Act. Such amounts shall be determined by the Secretary of the 
Treasury based on information provided by the government of the 
respective possession.
    (b) Payments to Other Possessions.--The Secretary of the Treasury 
shall pay to each possession of the United States which does not have a 
mirror code tax system amounts estimated by the Secretary of the 
Treasury as being equal to the aggregate benefits (if any) that would 
have been provided to residents of such possession by reason of the 
provisions of this Act if a mirror code tax system had been in effect 
in such possession. The preceding sentence shall not apply unless the 
respective possession has a plan, which has been approved by the 
Secretary of the Treasury, under which such possession will promptly 
distribute such payments to its residents.
    (c) Mirror Code Tax System.--For purposes of this section, the term 
``mirror code tax system'' means, with respect to any possession of the 
United States, the income tax system of such possession if the income 
tax liability of the residents of such possession under such system is 
determined by reference to the income tax laws of the United States as 
if such possession were the United States.
    (d) Treatment of Payments.--For purposes of section 1324 of title 
31, United States Code, the payments under this section shall be 
treated in the same manner as a refund due from a credit provision 
referred to in subsection (b)(2) of such section.

SEC. 7. EXCLUSION OF AMOUNTS RECEIVED FROM STATE-BASED CATASTROPHE LOSS 
              MITIGATION PROGRAMS.

    (a) In General.--Section 139 of the Internal Revenue 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 include any 
        amount received by an individual as a qualified catastrophe 
        mitigation payment under a program established by a State, or a 
        political subdivision or instrumentality thereof, for the 
        purpose of making such payments.
            ``(2) Qualified catastrophe mitigation payment.--For 
        purposes of this section, the term `qualified catastrophe 
        mitigation payment' means any amount which is received by an 
        individual to make improvements to such individual's residence 
        for the sole purpose of reducing the damage that would be done 
        to such residence 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) is amended by striking ``and qualified'' 
        and inserting ``, qualified catastrophe mitigation payments, 
        and qualified''.
            (2) Section 139(i) (as redesignated by subsection (a)) is 
        amended by striking ``or qualified'' and inserting ``, 
        qualified catastrophe mitigation payment, or qualified''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2020.

SEC. 8. EXCLUSION FROM GROSS INCOME OF CERTAIN EMERGENCY AGRICULTURAL 
              ASSISTANCE.

    (a) In General.--Section 139 of the Internal Revenue Code of 1986, 
as amended by the preceding provisions of this Act, is amended by 
redesignating subsection (i) as subsection (j) and by inserting after 
subsection (h) the following new subsection:
    ``(i) Certain Agricultural Assistance.--For purposes of this 
section, the term `qualified disaster relief payment' shall include any 
assistance received under any of the following:
            ``(1) Assistance received under the Wildfires and 
        Hurricanes Indemnity Program Plus under subpart O of part 760 
        of title 7, Code of Federal Regulations.
            ``(2) Assistance received under section 1501 of the 
        Agricultural Act of 2014 (7 U.S.C. 9081).
            ``(3) Noninsured crop assistance under section 196 of the 
        Federal Agriculture Improvement and Reform Act of 1996 (7 
        U.S.C. 7333).
            ``(4) Assistance under a food assistance program under part 
        9 of title 7, Code of Federal Regulations.
            ``(5) Assistance under title IV of the Agricultural Credit 
        Act of 1978 (16 U.S.C. 2201 et seq.).
            ``(6) Assistance under the Quality Loss Assistance 
        Program.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2020.

SEC. 9. SENSE OF CONGRESS REGARDING DISASTER LOAN PROCESSING.

    It is the sense of Congress that the Administrator of the Small 
Business Administration should use district offices of the 
Administration whenever possible to expedite the processing of disaster 
loans under section 7(b) of the Small Business Act (15 U.S.C. 636(b)).

SEC. 10. SMALL BUSINESS DEVELOPMENT CENTER PORTABILITY GRANTS.

    Section 21(a)(4)(C)(viii) of the Small Business Act (15 U.S.C. 
648(a)(4)(C)(viii)) is amended--
            (1) in the first sentence, by striking ``as a result of a 
        business or government facility down sizing or closing, which 
        has resulted in the loss of jobs or small business 
        instability'' and inserting ``due to events that have resulted 
        or will result in a business or government facility downsizing 
        or closing''; and
            (2) by adding at the end the following: ``At the discretion 
        of the Administrator, the Administrator may make an award 
        greater than $100,000 to a recipient to accommodate 
        extraordinary occurrences having a catastrophic impact on the 
        small business concerns in a community.''.

SEC. 11. DISASTER ASSISTANCE TO CRITICAL ENTERPRISES.

    Section 237 of the Disaster Relief Act of 1970 (15 U.S.C. 636d) is 
amended--
            (1) by redesignating subsection (b) as subsection (c); and
            (2) in subsection (a)--
                    (A) by striking ``Farmers Home Administration'' and 
                inserting ``Farm Service Agency'';
                    (B) by striking ``major disaster'' and inserting 
                ``major disaster or is vital to recovery efforts in the 
                disaster area (including providing debris removal 
                services, manufactured housing, gasoline, 
                telecommunications, or building materials),''; and
                    (C) by striking ``Loans authorized'' and all that 
                follows through ``pursuant thereto.'' and inserting the 
                following:
    ``(b) Terms and Conditions.--Notwithstanding any other provision of 
law, loans authorized by this section--
            ``(1) shall be made without regard to limitations on the 
        size of loans which may otherwise be imposed by any other 
        provision of law or regulations promulgated pursuant thereto; 
        and
            ``(2) may waive any required evaluation of creditworthiness 
        in exchange for a fee, as set by the Small Business 
        Administration or the Farm Service Agency, as applicable.''.

SEC. 12. CREDIT FOR QUALIFIED WILDFIRE MITIGATION EXPENDITURES.

    (a) In General.--Subpart B of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by inserting after 
section 27 the following new section:

``SEC. 28. QUALIFIED WILDFIRE MITIGATION EXPENDITURES.

    ``(a) In General.--There shall be allowed as a credit against the 
tax imposed by this chapter for the taxable year an amount equal to 30 
percent of the qualified wildfire mitigation expenditures paid or 
incurred by the taxpayer during such taxable year with respect to real 
property owned or leased by the taxpayer.
    ``(b) Qualified Wildfire Mitigation Expenditures.--For purposes of 
this section--
            ``(1) In general.--The term `qualified wildfire mitigation 
        expenditures' means any specified wildfire mitigation 
        expenditure made pursuant to a qualified State wildfire 
        mitigation program of a State which requires expenditures for 
        wildfire mitigation to be paid both by the taxpayer and such 
        State. Such term shall not include any item of expenditure 
        unless the ratio of the State's expenditure for such item to 
        the sum of the State's and taxpayer's expenditures for such 
        item is not less than 25 percent.
            ``(2) Specified wildfire mitigation expenditure.--The term 
        `specified wildfire mitigation expenditure' means, with respect 
        to any real property owned or leased by the taxpayer, any 
        amount paid or incurred to reduce the risk of wildfire by 
        removing accumulations of vegetation (including establishing, 
        expanding, or maintaining fuel breaks to serve as fire breaks) 
        on such real property.
            ``(3) Qualified state wildfire mitigation program.--The 
        term `qualified State wildfire mitigation program' means any 
        program of a State the primary purpose of which is to mitigate 
        the risk of wildfires in such State.
            ``(4) Treatment of reimbursements.--Any amount originally 
        paid or incurred by the taxpayer which is reimbursed by a State 
        under a qualified wildfire mitigation program of such State 
        shall be treated as paid by such State (and not by such 
        taxpayer).
    ``(c) Application With Other Credits.--
            ``(1) Business credit treated as part of general business 
        credit.--So much of the credit which would be allowed under 
        subsection (a) for any taxable year (determined without regard 
        to this subsection) that is attributable to expenditures made 
        in the ordinary course of the taxpayer's trade or business (or, 
        in the case of expenditures made by a State, would have been 
        expenditures made in the ordinary course of the taxpayer's 
        trade or business if made by the taxpayer) shall be treated as 
        a credit listed in section 38(b) for taxable year (and not 
        allowed under subsection (a)).
            ``(2) Personal credit.--For purposes of this title, the 
        credit allowed under subsection (a) for any taxable year 
        (determined after application of paragraph (1)) shall be 
        treated as a credit allowable under subpart A for such taxable 
        year.
    ``(d) Reduction of Credit Percentage Where Taxpayer Expenditures 
Less Than 30 Percent.--
            ``(1) In general.--If the expenditure percentage with 
        respect to any item of qualified wildfire mitigation 
        expenditure is less than 30 percent, subsection (a) shall be 
        applied by substituting `the expenditure percentage' for `30 
        percent' with respect to such item of expenditure.
            ``(2) Expenditure percentage.--For purposes of this 
        section, the term `expenditure percentage' means, with respect 
        to any item of qualified wildfire mitigation expenditure any 
        portion of which is paid or incurred by a State, the ratio 
        (expressed as a percentage) of--
                    ``(A) the taxpayer's expenditure for such item, 
                divided by
                    ``(B) the sum of the taxpayer's and such State's 
                expenditures for such item.
    ``(e) Special Rules.--
            ``(1) Treatment of expenditures related to marketable 
        timber.--An expenditure shall not be taken into account for 
        purposes of this section (whether made by the taxpayer or a 
        State pursuant to a qualified State wildfire mitigation program 
        of such State) if such expenditure is properly allocable to 
        timber which is sold or exchanged by the taxpayer. The 
        preceding sentence shall not apply to the extent that such 
        amount exceeds the gain on such sale or exchange.
            ``(2) Basis reduction.--For purposes of this subtitle, if 
        the basis of any property would (but for this paragraph) be 
        determined by taking into account any qualified wildfire 
        mitigation expenditure, the basis of such property shall be 
        reduced by the amount of the credit allowed under subsection 
        (a) with respect to such expenditure (determined without regard 
        to subsection (c)).
            ``(3) Denial of double benefit.--The amount of any 
        deduction or other credit allowable under this chapter for any 
        expenditure for which a credit is allowable under subsection 
        (a) shall be reduced by the amount of credit allowed under such 
        subsection for such expenditure (determined without regard to 
        subsection (c)).''.
    (b) Conforming Amendments.--
            (1) Section 38(b) of such Code is amended by striking 
        ``plus'' at the end of paragraph (32), by striking the period 
        at the end of paragraph (33) and inserting ``, plus'', and by 
        adding at the end the following new paragraph:
            ``(34) the portion of the qualified wildfire mitigation 
        expenditures credit to which section 28(c)(1) applies.''.
            (2) Section 1016(a) of such Code is amended by 
        redesignating paragraphs (35) through (38) as paragraphs (36) 
        through (39), respectively, and by inserting after paragraph 
        (34) the following new paragraph:
            ``(35) to the extent provided in section 28(e)(2),''.
            (3) The table of sections for subpart B of part IV of 
        subchapter A of chapter 1 of such Code is amended by inserting 
        after the item relating to section 27 the following new item:

``Sec. 28. Qualified wildfire mitigation expenditures.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to expenditures paid or incurred after the date of the enactment 
of this Act, in taxable years ending after such date.
                                 <all>