Sponsors (9)
The bill lowers the cost of private and local wildfire mitigation and firefighting assistance by making certain payments tax-free and expenses deductible—encouraging safety measures—while reducing federal revenue and creating administrative and misuse risks that could produce inconsistent application.
Homeowners and other taxpayers can reduce their out-of-pocket cost for wildfire mitigation because grants/services for on-property fuel reduction are excluded from taxable income (Sec. 2) and certified hazardous fuel-reduction costs are allowed as an above-the-line deduction (Sec. 3), making mitigation more affordable.
Homeowners, rural communities, and tribal lands are likely to see more property-level wildfire prevention (fuel breaks, prescribed burns, mechanical thinning) because the tax treatment increases incentives to do certified fuel-reduction work, lowering local wildfire risk to people and structures.
Local governments, utilities, and fire agencies may find funding and in-kind assistance for firefighting access, equipment, and training more attractive because those payments/assistance are excluded from taxable income, improving operational support for wildfire response.
All taxpayers and the federal budget face reduced revenue because excluding grants/services and allowing deductions lowers taxable income, potentially increasing deficits or crowding out other federal spending.
State, local, Tribal, and federal agencies — and taxpayers — will face added administrative and compliance burdens and uncertainty (ambiguous definitions of qualifying 'services', certification requirements, and at least one incorrect statutory reference), which can cause delays, inconsistent application, and increased IRS/agency workload.
Homeowners and communities risk improper or uneven claims (deductions or excluded payments for work that mainly benefits private property), which could undermine environmental and community wildfire-prevention goals and produce inequitable application.
Based on analysis of 3 sections of legislative text.
Makes grants/services for hazardous fuel reduction tax-free and creates an above-the-line deduction for taxpayer-paid fuel reduction work on real property.
Introduced June 26, 2025 by Darrell Issa · Last progress June 26, 2025
Creates two tax benefits to encourage private landowners to do hazardous fuel reduction on their property: (1) excludes from gross income grants, awards, and services received for carrying out hazardous fuel reduction activities or improvements on a taxpayer’s real property; and (2) establishes an above-the-line deduction for amounts a taxpayer pays or incurs for qualified hazardous fuel reduction activities on their real property. Both changes take effect for amounts received or paid after enactment and include definitions of covered activities, improvements, and hazardous fuels.