Did you take a disaster distribution...

[Marshafaye]

So, we did get disaster relief money, thru attorneys from PG&E. (California)

Attorneys said they would not be issuing 1099s.

So, no Fed tax due per tax bill. Wondering about California tax.

We live in Az but also will need to file in California, for w2 income there

. If we don't get a 1099, do we have to file for settlement,  including total with Attorney fees?

[MonikaK1]

Whether your payments are excludable from California income may depend on which disaster relief funds were involved. If you are referring to payments distributed as a result of legal settlements with PG&E to victims of California wildfires:

On December 12, 2024, the bipartisan Federal Disaster Tax Relief Act (H.R. 5863)  was signed into law. The bill includes legislation that exempts thousands of qualified wildfire victims in California from having to pay federal income tax on their settlement money or pay tax on attorney fees included in the settlement. This relief applies retroactively to qualified victims. See this Member of Congress webpage for more details.

The Federal Disaster Tax Relief Act excludes from taxpayer gross income, for income tax purposes, any amount received by an individual taxpayer as compensation for expenses or losses incurred due to a qualified wildfire disaster (a federally declared disaster declared after 2014 as a result of a forest or range fire). It also excludes relief payments for losses resulting from the East Palestine, Ohio, train derailment on February 3, 2023 and designates Hurricane Ian, among other federally declared disasters, as a qualified disaster for the purposes of determining the tax treatment of certain disaster-related personal casualty losses.

California tax law does not always conform with Federal law. Whether your payments qualify for exclusion from California taxes may depend on which incident was involved. See this California Franchise Tax Board webpage for information on which disaster relief payments may be excluded from California income. 

Many of these payments do qualify for exclusion, in which case you don't have to enter anything about them on your California return. If your payments don't qualify for exclusion, you would need to enter them in TurboTax when you reach the section of the California return interview that asks about California income that wasn't included on your Federal return.

@Marshafaye

[THartley20]

Hey I took a distribution from my IRA 401K whatever you call it in 2020 because we were allotted to without penalties at the time and dealing with covid. I elected on my taxes to go ahead and pay the taxes for the money that I received rather than doing it over a 3-year period. But it doesn't matter for some reason how I answer these questions about if I have taking a disaster distribution before 2024 and then it says four before 2023 and then it says before 2022 so I'm assuming I would say no to all of those but I'm pretty sure I've tried them all both ways and I still can't get it to go through. I mean just reading the question the answer would be yes but when I go into how I would know the way it states it I would say no to the answer please help me with this. Thank you!

[THartley20]

This is the same problem I'm having mine says are too instead of F I'm not sure why or how to proceed with this in order to file my taxes

[DanaB27]

You can try saying "No" on the "Have you ever taken a disaster distribution before 2024?" screen if you haven't taken 2021, 2022, or 2023 Qualified Disaster Distribution.

@THartley20 

@CaNj