! deduction is made retroactively inappli

CAUTION cable to net qualified disaster losses.

See Taxpayers who also file the 2025 Form 6251, Alternative Minimum Tax for Individuals , in the Instructions for Form 4684 for more infor- mation.

Federal disaster relief grants. Don’t include post-disaster relief grants received under the Robert T. Stafford Disaster Relief and Emergency Assistance Act in your income if the grant payments are made to help you meet necessary expenses or serious needs for medical, dental, housing, personal property, transportation, or funeral expenses. Don’t deduct casualty losses or medical expenses to the extent they are specifically reimbursed by these disaster relief grants. If the casualty loss was specifically reimbursed by the grant and you received the grant after the year in which you deducted the casualty loss, see Reimbursement received af-

ter deducting loss , earlier. Unemployment as- sistance payments under the Act are taxable unemployment compensation.

Qualified disaster relief payments. Qualified disaster relief payments aren’t included in the income of individuals to the extent any expenses compensated by these payments aren’t otherwise compensated for by insurance or other reimbursement. These payments aren’t subject to income tax, self-employment tax, or employment taxes (social security, Medicare, and federal unemployment taxes). No withholding applies to these payments.

Qualified disaster relief payments include payments you receive (regardless of the source) for the following expenses.

• Reasonable and necessary personal, family, living, or funeral expenses incurred as a result of a federally declared disaster.

• Reasonable and necessary expenses incurred for the repair or rehabilitation of a personal residence due to a federally declared disaster. (A personal residence can be a rented residence or one you own.)

• Reasonable and necessary expenses incurred for the repair or replacement of the contents of a personal residence due to a federally declared disaster.

Qualified disaster relief payments include amounts paid by a federal, state, or local government in connection with a federally declared disaster to individuals affected by the disaster. These payments must be made from a governmental fund, be based on individual or family needs, and not be compensation for services. Payments to businesses generally don’t qualify.

East Palestine disaster relief payments. Certain relief payments related to the train derailment in East Palestine, Ohio, on February 3, 2023, are not taxable. The payment can be excluded from income if it was provided by a government agency or Norfolk Southern Railway (including any subsidiary, insurer, agent, or related person) and received on or after February 3, 2023. Further, the amount must have been paid to you to compensate for the following.

• Loss, damages, or expenses.

• Loss in real property value.

• Closing costs with respect to real property (including realtor commissions).

• Inconvenience (including access to real property).