Disaster survivors would get tax breaks and easier access to retirement savings.
This bill would offer tax relief and financial flexibility to people affected by major federal disasters declared in 2025. Survivors could use their income from the year before the disaster for certain tax credits. It would also make it easier to get money from retirement funds without penalties. New tax deductions for losses and charitable giving would also be available. These changes aim to help individuals and communities recover financially after a disaster.
Today, people affected by major disasters face standard tax rules for calculating income, withdrawing from retirement accounts, and deducting charitable contributions. After this bill, people in qualified disaster areas would have temporary tax relief, including options to use prior year's income for tax credits, penalty-free access to retirement savings, and more generous deductions for losses and donations. It would also extend tax-free compensation for wildfire losses and boost housing credits in disaster zones.
HR 6842 · 119th Congress · December 18, 2025 · AI Summary by gemini-2.5-flash · 9/10
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