Ways and Means Advances Five Bipartisan Tax Bills, Including Disaster Relief

The House Ways and Means Committee voted unanimously on March 25, 2026, to advance five bipartisan tax bills covering disaster-loss deductions, IRS customer service, and whistleblower awards. None of the bills is law yet — each still needs a House floor vote and Senate action — but the unanimous committee margins (ranging from 41-0 to 43-0) signal a rare stretch of bipartisan tax legislating tucked inside an otherwise partisan year.

For affluent households, the most consequential of the five is the Doug LaMalfa Federal Disaster Tax Relief Certainty Act, which would extend the more generous personal casualty loss deduction rules through January 1, 2027, and exclude wildfire relief payments from taxable income for disasters declared after December 31, 2014. Current law, tightened by the 2017 tax overhaul, generally limits casualty loss deductions to federally declared disasters and requires losses to exceed 10% of adjusted gross income. The bill would keep the more taxpayer-friendly treatment in place for another year rather than letting it lapse.

What changed

The committee's own announcement details all five bills: the committee approved, by unanimous voice votes, the Survivor Justice Tax Prevention Act (excluding certain sexual-assault settlement damages from gross income), the LaMalfa disaster relief bill, the Supporting Early-childhood Educators' Deductions Act (extending the educator expense deduction to early-childhood teachers), the Taxpayer Experience Improvement Act, and the IRS Whistleblower Program Improvement Act. All five now move to the full House.

The Taxpayer Experience Improvement Act would require the IRS to publish a public dashboard tracking call volume, backlogs and average wait times, upgrade online refund-tracking tools, and — by 2028 — offer a callback option whenever a call goes unanswered for more than five minutes. The Whistleblower Program Improvement Act would tighten appeals standards, allow whistleblowers to proceed anonymously in more cases, and impose interest penalties on the IRS if it delays paying an approved award more than 12 months. The committee noted the whistleblower program has generated more than $7.37 billion in IRS collections since 2007.

Who is affected

Homeowners and business owners in high-value coastal, wildfire and flood-prone areas — think California, Florida and parts of the Mountain West — are the direct beneficiaries of the disaster-loss extension, since it is their claims that tend to involve larger dollar amounts and are most sensitive to the 10%-of-AGI floor. High earners who have filed or are considering a whistleblower claim with the IRS (for example, reporting a business partner's or employer's tax noncompliance) would benefit from faster payouts and stronger appeal rights under the fifth bill. Families that use disaster funds to rebuild vacation or investment property should also watch how the wildfire-payment exclusion is finalized, since it affects whether insurance and government relief payments show up as taxable income.

The after-tax math

Example: a couple with $500,000 of adjusted gross income suffers $150,000 in uninsured casualty losses to a home in a federally declared wildfire disaster area. Under the rules the LaMalfa bill would extend, they can deduct losses exceeding 10% of AGI ($50,000), after first subtracting a $100 per-event floor — leaving roughly $99,900 as an itemized deduction. At a marginal federal rate of 35%, that deduction is worth about $35,000 in reduced tax. If the more generous casualty-loss rules were instead allowed to lapse at the end of 2026, unreimbursed personal losses outside federally declared disasters would generally not be deductible at all, and even losses inside a declared disaster area could face a stricter calculation depending on how future legislation is written.

What to watch

All five bills still need full House passage and a Senate companion or vehicle — bipartisan committee approval does not guarantee floor time, and previous IRS-service and disaster-relief bills have stalled in the Senate in past years. Households who experienced a casualty loss in 2025 or 2026 may want to track the disaster-relief bill's progress before filing, since retroactive relief has sometimes been enacted after the original filing deadline. It is worth discussing with a CPA whether current-year documentation (appraisals, insurance correspondence, FEMA disaster declarations) is being kept in a form that would support a claim if the extension becomes law later in the year.

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