S. 3432

119 S3432 IS: Working Families Disaster Tax Relief Act
 U.S. Senate
 2025-12-11
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 EN
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 II  119th CONGRESS  1st Session  S. 3432  IN THE SENATE OF THE UNITED STATES   December 11, 2025   Ms. Klobuchar  (for herself and  Mr. Cassidy ) introduced the following bill; which was read twice and referred to the  Committee on Finance    A BILL
To amend the Internal Revenue Code of 1986 to allow disaster-affected taxpayers to use preceding taxable year earned income to determine eligibility for the earned income credit and the refundable portion of the child tax credit.
1.
Short title
This Act may be cited as the   Working Families Disaster Tax Relief Act  .
2.
Election for disaster-affected taxpayers to use preceding year earned income to determine credit eligibility
(a)
Election To use prior year income for disaster-Affected taxpayers with respect to child tax credit
 Section 24(d)  of the Internal Revenue Code of 1986 is amended to read as follows:
(4)
Election to use prior year income for disaster-affected taxpayers
(A)
In general
A disaster-affected taxpayer may elect to apply paragraph (1) by substituting  the preceding taxable year  for  the taxable year  each place such term appears.
(B)
Disaster-affected taxpayer
For purposes of this paragraph, the term  disaster-affected taxpayer  means, with respect to a taxable year—
(i)
a taxpayer whose principal place of abode or principal place of work, during any period in the taxable year which is part of the incident period of a qualified disaster, is located in a qualified disaster zone, or
(ii)
a taxpayer—
(I)
whose principal place of abode, during any period in the taxable year which is part of the incident period of a qualified disaster, is located in the qualified disaster area with respect to such qualified disaster, and
(II)
who is displaced from such principal place of abode during such taxable year as a result of such qualified disaster.
(C)
Definitions
For purposes of this paragraph—
(i)
Qualified disaster
The term  qualified disaster  means any disaster with respect to which a major disaster has been declared by the President under section 401 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act.
(ii)
Qualified disaster area
The term  qualified disaster area  means, with respect to any qualified disaster, the area with respect to which the major disaster was declared under the Robert T. Stafford Disaster Relief and Emergency Assistance Act.
(iii)
Qualified disaster zone
The term  qualified disaster zone  means the portion of a qualified disaster area determined by the President to warrant individual or individual and public assistance from the Federal Government under the Robert T. Stafford Disaster Relief and Emergency Assistance Act.
  .
(b)
Election To use prior year income for disaster-Affected taxpayers with respect to
  earned income credit
Section 32(c) of such Code is amended by adding at the end the following new paragraph:
(5)
Election to use prior year income for disaster-affected taxpayers
A disaster-affected taxpayer (as defined in section 24(d)(4)(B)) may elect to apply subsection (a)(1) by inserting  preceding  before  taxable year  in such paragraph.
  .
(c)
Effective date
The amendments made by this section shall apply to taxable years beginning after December 31, 2024.