119-hr140

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 140 Introduced in House

    (IH) ]

<DOC>

119th CONGRESS
 1st Session
 H. R. 140

 To provide tax relief for damages relating to Hurricanes Helene and 
 Milton.

_______________________________________________________________________

 IN THE HOUSE OF REPRESENTATIVES

 January 3, 2025

 Mr. Buchanan introduced the following bill; which was referred to the 
 Committee on Ways and Means

_______________________________________________________________________

 A BILL

 To provide tax relief for damages relating to Hurricanes Helene and 
 Milton.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Hurricane Helene 
and Milton Tax Relief Act of 2025''.

    (b) Table of Contents.--

Sec. 1. Short title; table of contents.

Sec. 2. Definitions.

Sec. 3. Earned income credit determined based on preceding taxable year 
 income with respect to qualified hurricane 
 disaster areas.

Sec. 4. Increased limitation on charitable contributions for qualified 
 hurricane disaster relief; certain 
 contributions paid before April 15, 2025, 
 treated as paid in 2024.

Sec. 5. Special hurricane disaster-related rules for use of retirement 
 funds.

SEC. 2. DEFINITIONS.

 For purposes of this Act--

    (a) Eligible Individual.--The term ``eligible individual'' means 
an individual whose principal place of abode at any time during the 
incident period is located in the qualified hurricane disaster area and 
who has sustained an economic loss by reason of Hurricane Helene or 
Hurricane Milton.

    (b) Qualified Hurricane Disaster Area.--The term ``qualified 
hurricane disaster area'' means an area with respect to which a major 
disaster has been declared by the President (before the date of the 
enactment of this Act) under 

section 401 of the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act by reason of Hurricane 
Helene or Hurricane Milton.
            (c) Incident Period.--The term ``incident period'' means the period 
beginning on September 28, 2024, and ending on November 2, 2024.

SEC. 3. EARNED INCOME CREDIT DETERMINED BASED ON PRECEDING TAXABLE YEAR 
 INCOME WITH RESPECT TO QUALIFIED HURRICANE DISASTER 
 AREAS.

    (a) In General.--In the case of an eligible individual, if the 
earned income of the taxpayer for the applicable taxable year is less 
than the earned income of the taxpayer for the preceding taxable year, 
the credit allowed under 

section 32 of the Internal Revenue Code of 
1986 for the applicable taxable year may, at the election of the 
taxpayer, be determined by substituting--

    (1) such earned income for the preceding taxable year, for

    (2) such earned income for the applicable taxable year.

    (b) Applicable Tax Year.--For purposes of this section, the term 
``applicable taxable year'' means any taxable year which includes any 
portion of the incident period.
            (c) Earned Income.--For purposes of this section, the term ``earned 
income'' has the meaning given such term under 

section 32
            (c) of such 
Code.
            (d) Special Rules.--

    (1) Application to joint returns.--For purposes of 
 subsection

    (a) , in the case of a joint return for an applicable 
 taxable year--
        (A) such subsection shall apply if either spouse is 
 an eligible individual, and
        (B) the earned income of the taxpayer for the 
 preceding taxable year shall be the sum of the earned 
 income of each spouse for such preceding taxable year.

    (2) Errors treated as mathematical error.--For purposes of 
 

section 6213 of such Code, an incorrect use on a return of 
 earned income pursuant to subsection

    (a) shall be treated as a 
 mathematical or clerical error.

    (3) No effect on determination of gross income, etc.--
 Except as otherwise provided in this section, such Code shall 
 be applied without regard to any substitution under subsection

    (a) .

    (4) Limitation to single taxable year.--No taxpayer may 
 make an election under subsection

    (a) if such taxpayer (or in 
 the case of a joint return, the taxpayer's spouse) made such an 
 election for any preceding taxable year.

SEC. 4. INCREASED LIMITATION ON CHARITABLE CONTRIBUTIONS FOR QUALIFIED 
 HURRICANE DISASTER RELIEF; CERTAIN CONTRIBUTIONS PAID 
 BEFORE APRIL 15, 2025, TREATED AS PAID IN 2024.

    (a) Qualified Hurricane Disaster Contributions.--

    (1) Individuals.--In the case of any qualified hurricane 
 disaster contribution, notwithstanding 

section 170

    (b) of such 
 Code, the total amount of such contributions which may be taken 
 into account under 

section 170

    (a) of such Code shall not exceed 
 the excess of--
        (A) the taxpayer's contribution base, over
        (B) the amount of all other charitable 
 contributions allowable under 

section 170

    (b)

    (1) of such 
 Code.

    (2) Carryover.--
        (A) In general.--If the aggregate amount of 
 contributions described in paragraph

    (1) exceeds the 
 limitation under such paragraph, such excess shall be 
 treated (in a manner consistent with the rules of 
 subsection 170
            (d) (1) of such Code) as a charitable 
 contribution to which paragraph

    (1) applies in each of 
 the 5 succeeding years in order of time.
        (B) Coordination with deduction for charitable 
 contributions.--For purposes of applying this paragraph 
 and sections 170

    (b)

    (1)
        (G) and 170
            (d) (1) of such Code, 
 contributions described in paragraph

    (1) shall not be 
 treated as described in subparagraph
        (A) or
        (G) of 
 

section 170

    (b)

    (1) of such Code and such subparagraphs 
 shall be applied without regard to such contributions.

    (3) Application of election to partnerships and s 
 corporations.--In the case of a partnership or S corporation, 
 the election under subsection

    (e)

    (3)
        (A)
            (iii) shall be made 
 separately by each partner or shareholder.

    (b) Corporations.--

    (1) In general.--In the case of any qualified hurricane 
 disaster contribution, notwithstanding 

section 170

    (b) of such 
 Code, the total amount of such contributions which may be taken 
 into account under 

section 170

    (a) of such Code shall not exceed 
 the excess of--
        (A) 20 percent of the taxpayer's taxable income, 
 over
        (B) the amount of charitable contributions allowed 
 under 

section 170

    (b)

    (2)
        (A) of such Code.

    (2) Carryover.--If the aggregate amount of contributions 
 described in paragraph

    (1) exceeds the limitation under such 
 paragraph, such excess shall be treated (in a manner consistent 
 with the rules of 

section 170
            (d) (1) of such Code) as a 
 charitable contribution to which paragraph

    (1) applies in each 
 of the 5 succeeding years in order of time.

    (3) Coordination with deduction for charitable 
 contributions.--For purposes of applying this paragraph and 
 sections 170

    (b)

    (2) of such Code, contributions described in 
 paragraph

    (1) shall not be treated as described in subparagraph
        (A) ,
        (B) , or
            (C) of 

section 170

    (b)

    (2) of such Code and such 
 subparagraphs shall be applied without regard to such 
 contributions.
            (c) Deduction Allowed Above the Line.--In the case of an 
individual--

    (1) the standard deduction otherwise determined under 
 

section 63 of such Code shall be increased by so much of the 
 deduction allowed under 

section 170 of such Code as would not 
 be so allowed if determined without regard to this section, and

    (2) section 56

    (b)

    (1)
            (D) of such Code shall not apply to so 
 much of the standard deduction as is attributable to the 
 increase under paragraph

    (1) .
            (d) Contributions Treated as Made in Prior Year.--For purposes of 
this section, a taxpayer may treat any qualified hurricane disaster 
contribution which is paid after December 31, 2024, and on or before 
April 15, 2025, as if such contribution was made on December 31, 2024, 
and not in 2025.

    (e) 

=== Definitions. ===
-For purposes of this section--

    (1) Charitable contribution.--The term ``charitable 
 contribution'' has the meaning given such term in 

section 170
            (c) of such Code.

    (2) Contribution base.--The term ``contribution base'' has 
 the meaning given such term in 

section 170

    (b)

    (1)
        (H) of such 
 Code.

    (3) Qualified hurricane disaster contribution.--
        (A) In general.--The term ``qualified hurricane 
 disaster contribution'' means any charitable 
 contribution if--
            (i) such contribution--
            (I) is paid on or after the first 
 day of the incident period and before 
 December 31, 2025, in cash to an 
 organization described in 

section 170

    (b)

    (1)
        (A) of such Code, and
            (II) is made for relief efforts in 
 a qualified hurricane disaster area 
 related to Hurricane Helene or 
 Hurricane Milton,
            (ii) 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 
 in a qualified hurricane disaster area related 
 to Hurricane Helene or Hurricane Milton, and
            (iii) the taxpayer has elected the 
 application of this section with respect to 
 such contribution.
        (B) Exception.--A qualified hurricane disaster 
 contribution shall not include a contribution by a 
 donor if the contribution is--
            (i) to an organization described in 

section 509

    (a)

    (3) of such Code, or
            (ii) for establishment of a new, or 
 maintenance of an existing, donor advised fund 
 (as defined in 

section 4966
            (d) (2) of such 
 Code).

SEC. 5. SPECIAL HURRICANE 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 hurricane 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 hurricane 
 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 hurricane 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 hurricane disaster 
 distribution, a plan shall not be treated as violating 
 any requirement of such Code merely because the plan 
 treats such distribution as a qualified hurricane 
 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 such Code.

    (3) Amount distributed may be repaid.--
        (A) In general.--Any individual who receives a 
 qualified hurricane 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 such 
 Code, as the case may be.
        (B) Treatment of repayments of distributions from 
 eligible retirement plans other than iras.--For 
 purposes of such Code, if a contribution is made 
 pursuant to subparagraph
        (A) with respect to a 
 qualified hurricane 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 hurricane 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 such Code, if a contribution is 
 made pursuant to subparagraph
        (A) with respect to a 
 qualified hurricane 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 hurricane 
 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 hurricane disaster distribution.--
 Except as provided in paragraph

    (2) , the term 
 ``qualified hurricane disaster distribution'' means any 
 distribution from an eligible retirement plan made--
            (i) on or after the first day of the 
 incident period and before December 31, 2025, 
 and
            (ii) to an eligible individual.
        (B) Eligible retirement plan.--The term ``eligible 
 retirement plan'' shall have the meaning given such 
 term by 

section 402
            (c) (8)
        (B) of such Code.

    (5) Income inclusion spread over 3-year period.--
        (A) In general.--In the case of any qualified 
 hurricane 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 

section 408A
            (d) (3)
        (E) of such Code 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 such Code, 
 qualified hurricane disaster distributions shall not be 
 treated as eligible rollover distributions.
        (B) Qualified hurricane disaster distributions 
 treated as meeting plan distribution requirements.--For 
 purposes of such Code, a qualified hurricane disaster 
 distribution shall be treated as meeting the 
 requirements of sections 401

    (k)

    (2)
        (B)
            (i) , 
 403

    (b)

    (7)
        (A)
            (i) , 403

    (b)

    (11) , and 457
            (d) (1)
        (A) of such 
 Code and 

section 8433

    (h)

    (1) of title 5, United States 
 Code, and, in the case of a money purchase pension 
 plan, a qualified hurricane disaster distribution which 
 is an in-service withdrawal shall be treated as meeting 
 the distribution rules of 

section 401

    (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 such Code) 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)
            (i) 
            (V) , 403

    (b)

    (11)
        (B) , or 72

    (t)

    (2)
        (F) , of 
 such Code,
        (B) which was to be used to purchase or construct a 
 principal residence in a qualified hurricane disaster 
 area, but which was not so used on account of Hurricane 
 Helene or Hurricane Milton, and
            (C) which was received during the period beginning 
 on the date which is 180 days before the first day of 
 the incident period 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 hurricane disaster area, the 
 period beginning on the first day of the incident period and 
 ending on December 31, 2025.
            (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 such Code) 
 to an eligible individual made during the period beginning on 
 the date of the enactment of this Act and ending on June 30, 
 2025--
        (A) section 72

    (p)

    (2)
        (A)
            (i) 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 an eligible 
 individual with an outstanding loan (on or after the first day 
 of the incident period) from a qualified employer plan (as 
 defined in 

section 72

    (p)

    (4) of such Code)--
        (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 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 December 31, 2025),
        (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.
            (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, 
 2025, or such later date as the Secretary may 
 prescribe.
 In the case of a governmental plan (as defined in 
 

section 414
            (d) of such Code), 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.
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