US EditionWildfire survivors who lost their homes could face another blow from taxes on settlement payouts
A bipartisan bill would shield wildfire compensation from taxes, but survivors say delays could leave payments exposed and reduce money for rebuilding.
- Thousands of wildfire survivors, including those from the 2025 Eaton Fire in Altadena, California, face potential taxation on settlement payouts after a federal exemption expired at the end of 2025.
- While Congress has historically shielded wildfire settlements from taxes, legislation has been short-lived and inconsistent, leaving gaps that risk saddling survivors with significant tax burdens on their compensation.
- One Altadena homeowner fears a 37% tax hit on her expected $700,000 settlement while managing construction costs estimated at $1 million, forcing difficult financial choices.
- The House Ways and Means Committee unanimously approved a bipartisan bill last month to extend tax relief through 2026, though the timeline for a floor vote remains uncertain.
- Survivors in Colorado, Hawaii, and Oregon face similar challenges, with Maui residents awaiting payments from a $4 billion settlement with Hawaiian Electric amid the broader tax uncertainty.
21 Articles
21 Articles
Los Angeles Times
Independent EspañolThousands of survivors of the 2025 Eaton fire in Altadena, California, have chosen to accept an early agreement from the utility company accused of provoking it, renouncing future litigation in exchange for a faster payment that could help them rebuild or relocate.
California wildfire survivors who lost their homes could face another blow from taxes on settlement payouts
Thousands of survivors of the 2025 Eaton Fire in Altadena, California, have elected to accept an upfront settlement from the utility accused of causing it, forgoing future litigation for a faster payment that could help them rebuild or relocate.But unless a bill moving through Congress becomes law, that money could be taxed as income, taking big bites out of their payments and possibly disqualifying them from other government benefits. “There wa…
Associated Press News
Wildfire survivors who lost their homes could face another blow from taxes on settlement payouts
Thousands of survivors of the 2025 Eaton Fire in California are accepting settlements from the utility accused of causing it.
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