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Bill

SB 159

Personal Income Tax Law: Corporation Tax Law: exemptions: wildfire.

2025-2026 Regular Session

SB 159 exempts wildfire-related losses from California personal income and corporation taxes to provide financial relief to fire-affected taxpayers and businesses.

Chaptered by Secretary of State. Chapter 112, Statutes of 2025.
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WeVote Research Nonpartisan
Bill Summary · SB 159

Legislative bill overview

SB 159 creates tax exemptions related to wildfire losses under California's personal income tax and corporation tax laws. The bill provides relief to taxpayers affected by wildfires by exempting certain wildfire-related income or deductions from state taxation. This measure was signed into law in September 2025.

Why is this important

California experiences increasingly severe and frequent wildfires that cause substantial financial losses to individuals and businesses. Tax exemptions can help affected parties recover economically by reducing their state tax burden during rebuilding and recovery periods, though the scope and specificity of the exemption determines its actual impact.

Potential points of contention

  • Scope and eligibility: The bill's specific definition of qualifying wildfire losses and which taxpayers are eligible (homeowners, renters, businesses, insurers) affects how many people benefit and total revenue impact
  • Fiscal cost to the state: Tax exemptions reduce state revenue; critics may argue these resources could be better directed to wildfire prevention or community recovery programs rather than tax relief
  • Equity concerns: Questions about whether tax-based relief favors higher-income earners who benefit more from exemptions and whether it adequately helps lower-income disaster survivors who may not owe significant taxes

Compiled from official sources — confirm details with the bill’s official record.

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