Sponsors (2)
The bill makes meaningful, refundable financial assistance available to homeowners to harden homes against disasters (including low-income filers), but the benefit is constrained by caps, exclusions for those receiving other government aid, income phaseouts, and added compliance/ tax-complexity that limit reach and timeliness.
Homeowners — including low- and moderate-income filers who owe little or no tax — can receive a refundable credit covering 50% of qualifying mitigation work (up to $25,000 lifetime), substantially lowering out-of-pocket costs for storm/flood/fire hardening.
Owners in federally declared disaster areas or FEMA-assisted communities gain a clear financial incentive to reduce future damage risk, which should lower expected repair costs and insurance losses for those communities over time.
Indexing dollar thresholds and phaseout points for inflation preserves the real value of the credit and phaseout structure over time, maintaining its purchasing power and predictability.
Homeowners who already receive government disaster aid cannot claim the credit, excluding many of the people most likely to need mitigation assistance and reducing the program's reach.
The $25,000 lifetime cap and per-unit limits mean high-cost mitigation projects will often be only partially subsidized, leaving homeowners to cover substantial residual costs.
Phaseouts for higher-income filers (AGI $200k–$300k) reduce or eliminate benefits for many moderate-to-upper-income homeowners in disaster-prone regions, limiting assistance to a narrower income band.
Based on analysis of 2 sections of legislative text.
Creates a refundable individual tax credit covering 50% of qualifying disaster-mitigation expenses for eligible principal residences with a $25,000 lifetime cap and income phaseout.
Official title: Amend the Internal Revenue Code of 1986 to provide a refundable credit against tax for disaster mitigation expenditures.
Introduced April 8, 2025 by Adam Schiff · Last progress April 8, 2025
Creates a new refundable individual income tax credit that pays 50% of eligible disaster-mitigation expenses for a taxpayer's principal residence, up to a lifetime cap ($25,000 single/$12,500 married filing separately), with phaseout for higher-income taxpayers and rules limiting double benefits. The credit applies to residences in areas with recent federal disaster declarations, FEMA mitigation assistance, or designated community resilience zones, excludes amounts reimbursed by government programs, requires IRS documentation, and takes effect for tax years beginning after December 31, 2024.