WASHINGTON, D.C. (MPG) – On March 5, Congressman Doug LaMalfa (R-Richvale), Congressman Mike Thompson (D-CA), Congressman Greg Murphy, M.D. (R-NC), and Congressman Jimmy Panetta (D-CA) introduced the Disaster Mitigation and Tax Parity Act. This legislation exempts rebates that homeowners receive for hardening their homes against natural disasters from federal taxes.

“Homeowners shouldn’t be hit with unexpected federal taxes just because they received rebates through state and local programs,” said Rep. Doug LaMalfa. “Right now, there’s an unfair gap between how federal and state disaster assistance is treated, leaving many homeowners with an added tax burden at the worst possible time. We need to be sure that disaster mitigation efforts actually reduce risks and help people rebuild, rather than having their assistance siphoned away by federal taxes.”

Said Rep. Mike Thompson, “California has been ground zero for climate-related natural disasters and investing in disaster resilience programs is essential to the safety and security of communities throughout our state. I am proud to reintroduce legislation with Rep. LaMalfa to exempt these programs from federal taxation to ensure that our communities can make the proper investments in disaster resilience and help mitigate the risks we face from natural disasters.”

Said Congressman Greg Murphy, M.D., “Catastrophe mitigation payments used to improve natural disaster resilience should not be treated as a source of income, and North Carolinians should not be taxed for them. Eastern North Carolina understands how deadly and damaging hurricanes can be, and the costs associated with rebuilding. Adequate preparation for storms is a valuable investment and should be strongly incentivized, not taxed. This bill empowers individuals to protect themselves before disaster strikes, reducing or eliminating entirely, the risk of catastrophic damage to their homes.”

Said Rep. Jimmy Panetta, “Right now, survivors of natural disasters can face an unexpected federal tax burden on state disaster assistance, an unfair penalty when they’re trying to rebuild. The Disaster Mitigation and Tax Parity Act fixes this by ensuring state-based disaster grants receive the same federal tax exemption as FEMA assistance. I’m proud to join my colleagues in this bipartisan effort to make disaster aid more effective for those who need it most.”

California and North Carolina, among other states, offer rebates to homeowners who take steps to protect their homes from natural disasters, such as clearing fire-prone vegetation near structures to reduce wildfire risk, reinforcing foundations against earthquakes, and installing impact-resistant roofing. However, if these rebates come from state or local sources, homeowners are required to pay federal taxes on them. Meanwhile, rebates for energy conservation improvements are already exempt from federal income taxes. This bill would ensure that natural disaster mitigation efforts receive the same tax treatment.

Congressman Doug LaMalfa is chairman of the Congressional Western Caucus and a lifelong farmer representing California’s First Congressional District, including Butte, Colusa, Glenn, Lassen, Modoc, Shasta, Siskiyou, Sutter, Tehama and Yuba Counties.