Personal Income Tax Law: Corporation Tax Law: exclusions: wildfires.

Assembly Member Hadwick's tax relief measure creates new exclusions from gross income for settlement payments received by residents and businesses affected by the 2021 Dixie Fire and 2022 Mill Fire. The exclusions apply to settlements from Pacific Gas and Electric Company related to the Dixie Fire, which impacted Butte, Plumas, Lassen, Shasta, and Tehama counties, and from Roseburg Forest Products for the Mill Fire in Siskiyou County.

Eligible recipients include property owners, residents, and businesses located in the affected counties during the fires who incurred expenses and received settlement payments. The settlement entities must provide documentation of payments to the Franchise Tax Board upon request. The exclusions apply to tax years 2022 through 2026, with both provisions set to expire on December 1, 2027.

The Franchise Tax Board must report to the Legislature by December 2027 on the number of taxpayers who utilized the exclusions and the total amount of settlement payments excluded from taxation. The bill's findings state these provisions aim to prevent undue hardship for taxpayers in fire-devastated areas. As an urgency measure, the bill would take effect immediately upon enactment.