U.S. Sen. Bill Cassidy (R-LA) and U.S. Rep. Maria Elvira Salazar (R-FL) on Dec. 16 proposed bipartisan, bicameral legislation that would create a first-of-its-kind disaster mitigation tax credit for families and small business owners in disaster-prone areas.
“Everybody in my state has lost someone or something they love because of flooding,” Sen. Cassidy said. “This is another tool for families to minimize that loss.”
The Shelter Act, S. 3497, which Sen. Cassidy cosponsored alongside bill sponsor U.S. Sen. Michael Bennet (D-CO), would provide a credit against tax for disaster mitigation expenditures. Rep. Salazar sponsored the identical H.R. 6763 in the U.S. House with lead original cosponsor U.S. Rep. Brittany Pettersen (D-CO).
“A single storm shouldn’t be able to erase a lifetime of work. The Shelter Act empowers families and small businesses to fortify their property before disaster strikes, making our communities safer, stronger, and more resilient,” said Rep. Salazar. “Miami families know the cost of preparedness all too well, and this bill helps ensure they’re not facing those challenges alone.”
Specifically, S. 3497 would allow Americans to write off 25 percent of qualifying mitigation expenses, up to $3,750 per taxpayer ($7,500 for married couples filing jointly), phasing out at $100,000 in adjusted gross income, to help reinforce their properties against natural disasters such as flood, wildfire, hail, and wind.
For small businesses, there would be a similar 25-percent credit up to $5,000 annually, with phaseout beginning at $5 million in average gross receipts over three years, according to a bill summary provided by the lawmakers.
The proposed federal tax incentive could help families and businesses proactively invest in disaster resilience and mitigation, helping offset the hundreds of billions of taxpayer dollars spent on natural disaster recovery each year, the lawmakers said.
The Shelter Act is supported by several organizations, including the National Institute of Building Sciences, the National Association of Realtors, the National Association of Home Builders, the Insurance Institute for Business & Home Safety, the Federal Alliance for Safe Homes, and the American Property Casualty Insurance Association, among others.