LAHAINA, Hawaii (KHON2) — A bill introduced by U.S. Representative Jill Tokuda and U.S. Senator Maxie K. Hirono has been unanimously passed by the U.S. Senate to aid Maui wildfire survivors.
Federal Disaster Tax Relief Act of 2023 will exempt relief payments from taxable income for victims of natural disasters between Jan. 1, 2020, and Dec. 31, 2025.
For Lahaina survivors, the bill will eliminate the minimum 10% threshold to deduct disaster-related losses, attorney fees and the requirement to itemize deductions.
“I have been fighting to provide financial relief to Lahaina fire survivors and natural disaster victims throughout the country. In a time of extreme partisanship, I’m proud that Republicans and Democrats in both the House and Senate came together on disaster relief and passed the Federal Disaster Tax Relief Act,” said Rep. Tokuda.
The bill is now set to be signed by President Joe Biden.
“Any settlement money survivors receive belongs to them, not the federal government. We will continue to do everything we can to help survivors and the Maui community to recover and rebuild,” added U.S. Senator Brian Schatz.
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KHON2 has asked the Hawaii Tax Department whether relief payments are taxable at the state level and is waiting to hear back.