East Palestine train derailment frequently asked questions

Updated for the Federal Disaster Tax Relief Act of 2023

On Dec. 12, 2024, the Federal Disaster Tax Relief Act of 2023, Pub. Law 118-148, expanded and clarified the payments related to the Feb. 3, 2023, train derailment in East Palestine, Ohio that are not taxable. This legislation followed the IRS’s issuance of Notice 2024-46 PDF, which addressed the treatment of certain relief payments made to individuals affected by the derailment. These frequently asked questions address the enacted legislation.

Q1. Do I have to pay taxes on the East Palestine disaster relief payments I received? (added Nov. 4, 2025)

A1. Certain “qualified disaster relief payments” made to individuals affected by the Feb. 3, 2023, East Palestine train derailment are not taxable. These payments can be excluded from income if they were provided by a Federal, State, or local government agency or Norfolk Southern Railway (including any subsidiary, insurer, agent, or related person) and received by the affected individual on or after Feb. 3, 2023. Further, the amounts must have been paid to or on behalf of the affected individual to compensate for the following resulting from the derailment:

• Loss, damages, or expenses;
• Loss in real property value;
• Closing costs with respect to real property (including realtor commissions); and/or
• Inconvenience (including access to real property).

Examples of payments that are non-taxable include:

• Relocation expenses and expenses for replacing clothing and personal items
• Cost of repairing or rehabilitating homes and the surrounding environment
• Compensation to homeowners who sold their homes after the derailment
• Medical expenses
• The one-time $1,000 inconvenience payments made by Norfolk Southern Railway to affected individuals

However, qualified disaster relief payments don’t include:

• Payments for expenses paid for by insurance or otherwise;
• Lost wages or unemployment compensation; or
• Payments to businesses.

Q2. I already filed my tax return, what do I need to do? (added Nov. 4, 2025)

A2. If you already filed your 2023 tax return and did not report any qualified disaster relief payments as taxable on your return, you do not need to take any action.

If you already filed your 2023 tax return and reported qualified disaster relief payments as taxable you can amend your return, report the exclusion, and claim any refund of taxes paid by filing Form 1040-X.

The IRS urges anyone who e-filed their 2023 return to e-file their amended return to speed processing. Visit File an amended return for details.

• If filing Form 1040-X electronically, attach a blank .pdf with filename “EPTDR-East Palestine Train Derailment Relief.” You may also type in, “East Palestine Train Derailment Relief,” at the beginning of Part III, Explanation of Changes.
• If filing Form 1040-X on paper, write, “East Palestine Train Derailment Relief,” at the top of Form 1040-X, as well as at the beginning of Part II, Explanation of Changes. Mail the completed form to the address in the form instructions.

Q3. I have not filed yet. What do I need to do? (added Nov. 4, 2025)

A3. Any taxpayer who has not yet filed their 2023 return does not need to report qualified disaster relief payments on their tax return, even if reported to them on Form 1099-MISC. However, if taxable payments are received, they must be reported. The IRS urges taxpayers to file any delinquent tax returns as soon as possible.

• If filing Form 1040 electronically, attach a .pdf to the Form 1040 with a filename “EPTDR-East Palestine Train Derailment Relief.”
• If filing Form 1040 on paper, write “East Palestine Train Derailment Relief” at the top of Form 1040. Mail the Form 1040 to the address in the form instructions.

Q4. What happens if the IRS contacts me because I didn't report the full amount shown on a Form 1099-MISC? (added Nov. 4, 2025)

A4. The IRS is working to avoid contacting impacted individuals about non-taxable amounts received. If you are contacted by the IRS, please reference the Federal Disaster Tax Relief Act of 2023 and inform the IRS employee that these payments are related to the East Palestine Derailment Relief.