Disaster Zone Energy Affordability and Investment Act
Introduced February 9, 2026 · Last action February 9, 2026
Plain English Summary
This bill allows businesses in federally declared disaster areas to transfer unused general business tax credits to other entities, rather than carrying them forward only for their own use. The credits eligible for transfer are those related to energy and investment incentives, and must be used within two years of the disaster declaration. The bill applies to disasters declared after December 31, 2023.
Who benefits
Businesses operating in federally or state-declared disaster areas that have accumulated general business tax credits related to energy production and investment; these businesses can now transfer unused credits to other taxpayers instead of being limited to carrying them forward. This particularly benefits mid-sized and larger businesses with tax credit carryforwards from energy investments (solar, wind, clean energy production) and consolidated corporate groups operating in disaster zones. Real estate developers, construction firms, manufacturers, and energy producers in disaster-affected regions are the primary beneficiaries.
Who pays / loses
The federal government loses tax revenue equal to the value of credits transferred from disaster-affected businesses to other taxpayers who use those credits to reduce their own tax liability. Taxpayers in non-disaster areas do not directly lose benefits, but the government's overall tax base is reduced by the amount of transferred credits. Businesses without disaster-area operations or without credit carryforwards do not benefit from this change.
Funding & Lobbying Interests
The bill was introduced by a bipartisan group of representatives including Greg Steube (R-FL), Patrick Murphy (D-FL), Vern Buchanan (R-FL), and others, many representing Florida and other disaster-prone states. The financial interests benefiting from this bill include renewable energy companies (solar and wind producers), energy infrastructure developers, real estate and construction firms with operations in disaster zones, and large consolidated business groups. Energy production and investment tax credit programs are heavily used by the renewable energy sector, oil and gas operators, and manufacturing facilities. The bill's focus on energy-related credits suggests support from the renewable energy industry and energy producers operating in disaster-declared areas.
Political Impact
Affected Groups
Businesses of all sizes operating in federally or state-declared disaster areas declared after December 31, 2023, particularly those in the energy, construction, real estate, and manufacturing sectors with accumulated tax credits. Employees and communities in disaster-affected areas may indirectly benefit if businesses use transferred credit revenue for business expansion or recovery. The bill does not specify a minimum or maximum business size, so it applies across all business scales that have credit carryforwards. Disaster-prone states such as Florida, Louisiana, Texas, and California with recurring major disaster declarations are disproportionately affected.
Political Subtext
Proponents frame this as disaster relief that accelerates economic recovery by allowing disaster-affected businesses to monetize tax credits they cannot fully use themselves, freeing up capital for rebuilding and investment. The bill has bipartisan support, particularly from representatives of disaster-prone states. Critics would argue this amounts to targeted tax relief for businesses that could be structured as direct subsidies or grants and that it erodes the tax base without transparent fiscal impact. The bill avoids increasing federal spending directly by using the tax code to transfer private resources, which sidesteps appropriations processes and obscures the true cost of disaster recovery assistance.
Real-World Stakes
If this passes, disaster-affected businesses in energy, construction, and manufacturing will be able to sell or transfer accumulated tax credits to other businesses seeking to reduce their tax liability, rather than being limited to carrying credits forward for their own use. This increases the market value of credits for disaster-zone businesses and may accelerate capital formation for recovery. The financial impact depends on the volume of credit carryforwards in disaster areas and the price at which credits transfer. No comparable federal policy precedent with measured outcomes is available in recent legislative history, though similar credit-transfer provisions exist in other parts of the tax code. The mechanism mirrors the 'direct pay' election added to the tax code in 2021, which allows certain entities to monetize credits directly rather than using them only for tax liability reduction. This bill extends that concept to the transferability of carryforwards rather than current-year credits.
Sponsor
Sponsor information not available.
Vote Record
No recorded votes.
Campaign Finance — Primary Sponsor
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501(c)(4) disclosure: Contributions from 501(c)(4) "dark money" organizations are not required to be publicly disclosed and are not reflected in the figures above. Data sourced from FEC public disclosure filings.
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