Earthquake Mitigation and Tax Parity Act

II 116TH CONGRESS 1ST SESSION S. 1058 To amend the Internal Revenue Code of 1986 to exclude from gross income earthquake loss mitigation received under State-based earthquake loss mitigation programs. IN THE SENATE OF THE UNITED STATES APRIL 8, 2019 Ms. HARRIS (for herself and Mrs. FEINSTEIN) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to exclude from gross income earthquake loss mitigation received under State-based earthquake loss mitigation programs. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Earthquake Mitigation 4 and Tax Parity Act’’. 5 VerDate Sep 11 2014 22:06 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1058.IS S1058 pamtmann on DSKBFK8HB2PROD with BILLS 2 •S 1058 IS SEC. 2. EXCLUSION OF EARTHQUAKE LOSS MITIGATION RE- 1 CEIVED UNDER STATE-BASED EARTHQUAKE 2 LOSS MITIGATION PROGRAMS. 3 (a) IN GENERAL.—Part III of subchapter B of chap- 4 ter 1 of the Internal Revenue Code of 1986 is amended 5 by inserting after section 139G the following new section: 6 ‘‘SEC. 139H. STATE-BASED EARTHQUAKE LOSS MITIGATION 7 PROGRAMS. 8 ‘‘(a) IN GENERAL.—Gross income shall not include 9 any earthquake loss mitigation received by a residential 10 property owner or occupant under a State-based earth- 11 quake loss mitigation program. 12 ‘‘(b) EARTHQUAKE LOSS MITIGATION.—For pur- 13 poses of this section— 14 ‘‘(1) IN GENERAL.—The term ‘earthquake loss 15 mitigation’ means any property or service that re- 16 duces seismic risks to a residential structure or its 17 contents. 18 ‘‘(2) TREATMENT OF REIMBURSEMENTS, 19 ETC.—Such term shall include any payment, reim- 20 bursement, loan, loan forgiveness, grant, credit, re- 21 bate, voucher, or other financial incentive for any 22 property or service described in paragraph (1). 23 ‘‘(3) SEISMIC.—The term ‘seismic’ has the 24 meaning given such term by section 4(3) of the 25 VerDate Sep 11 2014 22:06 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1058.IS S1058 pamtmann on DSKBFK8HB2PROD with BILLS 3 •S 1058 IS Earthquake Hazards Reduction Act of 1977 (42 1 U.S.C. 7703(3)). 2 ‘‘(c) EARTHQUAKE LOSS MITIGATION PROGRAM.— 3 For purposes of this section, the term ‘earthquake loss 4 mitigation program’ means any program which provides 5 residential property owners or occupants with earthquake 6 loss mitigation and which is established by a State, or 7 agency, instrumentality, or political subdivision thereof, by 8 itself or together with— 9 ‘‘(1) an organization described in section 501(c) 10 and exempt from tax under section 501(a), 11 ‘‘(2) an organization determined to be exempt 12 from State taxes pursuant to the laws of the rel- 13 evant State, or 14 ‘‘(3) a public instrumentality of a State pursu- 15 ant to a joint exercise of powers. 16 ‘‘(d) SPECIAL RULES.— 17 ‘‘(1) NO INCREASE IN BASIS.—Notwithstanding 18 any other provision of this subtitle, no increase in 19 the basis or adjusted basis of any property shall re- 20 sult from any amount excluded under this subsection 21 with respect to such property. 22 ‘‘(2) DENIAL OF DOUBLE BENEFIT.—Notwith- 23 standing any other provision of this subtitle, no de- 24 duction or credit shall be allowed for, or by reason 25 VerDate Sep 11 2014 22:06 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1058.IS S1058 pamtmann on DSKBFK8HB2PROD with BILLS 4 •S 1058 IS of, any expenditure to the extent of the amount ex- 1 cluded under subsection (a) for any qualified earth- 2 quake mitigation which was provided with respect to 3 such expenditure.’’. 4 (b) CLERICAL AMENDMENT.—The table of sections 5 for part III of subchapter B of chapter 1 of such Code 6 is amended by inserting after the item relating to section 7 139G the following new item: 8 ‘‘Sec. 139H. State-based earthquake loss mitigation programs.’’. (c) EFFECTIVE DATE.—The amendments made by 9 this section shall apply to taxable years beginning after 10 December 31, 2018. 11 Æ VerDate Sep 11 2014 22:06 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\S1058.IS S1058 pamtmann on DSKBFK8HB2PROD with BILLS