Tax credits for disaster-proofing homes and businesses—but only in declared disaster zones
H.R. 6763 — Shelter Act · Filed by Maria Salazar (R-FL) · 3 cosponsors · Introduced Dec 16, 2025 · Referred to committee
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What it does
The Shelter Act creates two new tax credits to incentivize homeowners and businesses to invest in disaster-mitigation improvements: a 25% personal credit (up to $3,750/year, $7,500 joint; $15,000 lifetime per home) for residential retrofits like reinforced roofs, flood barriers, and fire-resistant materials, and a 25% business credit (up to $5,000/year) for similar improvements to commercial properties. Both credits apply only to properties in federally declared disaster areas or those receiving FEMA mitigation assistance, and phase out at higher incomes ($100k+ for individuals, $5M+ for businesses).
Why we flagged it
The bill's core mechanism is straightforward: it uses the tax code to subsidize private spending on hazard mitigation. The stated purpose (reducing disaster risk) aligns with the actual mechanism (tax credits for qualifying improvements).
What the text implies
- The credit is capped at $15,000 lifetime per dwelling unit, meaning high-value properties may not recoup full mitigation costs, while lower-income homeowners benefit proportionally more.
- Eligibility tied to prior FEMA assistance or federal disaster declarations may exclude properties in high-risk areas that have not yet experienced a declared disaster, creating a perverse incentive to wait for disaster before retrofitting.
The full analysis lists 5 implications of this text.
Who stands to gain
residential property owners in disaster-prone areas; commercial real estate operators (small to mid-market); construction and retrofit contractors