Disaster Tax Relief Bill Offers Lifeline to Maui Fire Survivors

WASHINGTON D.C. - U.S. Representative Jill N. Tokuda (HI-02) voted in favor of the Doug LaMalfa Federal Disaster Tax Relief Certainty Act, which passed the House unanimously. Rep. Tokuda co-led this bipartisan legislation to extend critical tax relief for wildfire survivors, including those in Lahaina and Kula, ensuring they can maximize disaster aid and focus on rebuilding their homes and lives.

This bill allows residents to claim significant tax deductions for property losses not covered by insurance. It also guarantees that any wildfire relief payments and disaster settlements received will remain completely tax-exempt at the federal level, allowing affected families to direct these resources toward recovery. The provision applies to disasters that are declared before 2027, regardless of when the actual relief payments are made or deductible expenses are incurred.

Rep. Tokuda spoke on the floor of the U.S. House regarding the urgency of passing this important measure for the people of Hawaiʻi. The tax relief provision enacted in 2024 expired on December 31, 2025, and without further legislative action, wildfire survivors would once again be subject to federal taxation on settlements and relief payments intended to support their recovery.

"The people of Maui never could have anticipated the day flames would overtake their island. They did not seek or ask to lose their homes, their businesses, their livelihoods, their history, their loved ones," said Rep. Tokuda. "But they should be able to count on this: that every dollar and every resource meant to help them rebuild, recover and return home stays with them, in their pockets, not in government coffers."

Rep. Tokuda previously advanced this legislation with the late Rep. Doug LaMalfa (R-CA-01), whose congressional district also experienced a deadly and destructive wildfire in 2018.

A clip of Rep. Tokuda's floor remarks may be found here. The bill will now move to the U.S. Senate for consideration.

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