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Support for Senator Brian Dahle’s (R-Bieber) measure, Senate Bill (SB) 927, is growing following Wednesday’s hearing in the Senate Committee on Revenue and Taxation. The bill would exclude from taxable income, settlement payments made in connection with any declared state of emergency by the Governor and President of the United States.
“I’m proud of this legislation, and I’m thankful to the Chair and Committee for moving this forward,” said Senator Dahle. “It’s not okay that we tax Californians on these payments when they’re doing everything they can to rebuild and recover. My district has suffered from some of the most devastating wildfires in California’s history, and they, along with all Californians, deserve to be adequately compensated for their losses.”
Senator Dahle brought forward similar legislation last year excluding income taxes for individuals who received settlements from Pacific Gas & Electric in connection with the Zogg Fire. The bill passed unanimously through both houses, displaying legislators’ enthusiastic support for excluding these settlements from being taxed.
SB 927 would end the cumbersome practice of waiving taxes one disaster at a time, and instead create a cohesive statewide policy. The bill seeks to better serve and support traumatized victims.
Background: When a person loses property to a fire, flood, or other catastrophe and receives a settlement as compensation, from a utility or other private entity, federal and state laws consider that taxable income. This is an unjust burden on Californians trying to rebuild their homes and lives after disasters.