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Introduced December 16, 2025 by Maria Elvira Salazar · Last progress December 16, 2025
Creates two new tax credits to encourage private investment in disaster mitigation: a nonrefundable individual credit equal to 25% of qualifying mitigation costs for a homeowner’s qualified dwelling (annual limits, a per-dwelling cumulative cap, income phaseout, five-year carryforward, and documentation requirements), and a business credit equal to 25% of qualifying mitigation costs for business property (a $5,000 annual cap and a size-based phaseout). Both credits exclude amounts already paid or reimbursed by government programs, require meeting consensus building codes or specified location/disaster tests, and apply to tax years beginning after December 31, 2025.
The bill makes resilience upgrades more affordable by offering 25% tax credits and broader eligible costs—helping homeowners and small businesses invest in mitigation—while limitations (nonrefundability, caps, phaseouts, eligibility restrictions, and administrative requirements) constrain reach and may leave lower‑income households, mid‑sized firms, and some at‑risk communities under‑served.
Homeowners can claim a 25% tax credit for qualifying disaster-mitigation upgrades, reducing their out-of-pocket cost for resilience improvements.
Small businesses can claim a 25% tax credit for eligible mitigation expenditures (treated as a general business credit), lowering after-tax costs for resiliency investments and allowing standard ordering/carryforward tax treatment.
The credit calculation can include labor, inspection, and third‑party certification costs, making higher-cost resilience projects more affordable and supporting contractor activity.
Low- and moderate-income homeowners with little or no federal tax liability get limited immediate benefit because the credit is nonrefundable (it cannot create a refund).
Per-dwelling cumulative caps ($15,000) and the annual limits ($3,750/$7,500) may be insufficient for large or whole‑house mitigation projects, leaving homeowners to cover the remaining costs.
Documentation, certification, and up‑to‑date code‑compliance requirements create administrative burdens and possible extra costs or delays for homeowners, contractors, and inspectors trying to demonstrate eligibility.