To amend the Internal Revenue Code of 1986 to allow penalty-free distributions from qualified retirement plans of individuals residing in Presidentially declared disaster areas and to allow relief from certain limitations on the deductibility of casualty losses sustained in such disaster areas.

Amends the Internal Revenue Code, with respect to exceptions to 10-percent additional tax on early distributions from qualified retirement plans, to allow penalty-free distributions from such plans (used within 90 days of distribution) for individuals residing in presidentially declared disaster areas.

Makes the current casualty loss limitation of ten percent of adjusted gross income inapplicable to losses incurred in such areas after July 31, 1999. Reduces a taxpayer's gross income by the amount of such disaster loss deduction (thereby making the deduction available to both itemizing and non-itemizing taxpayers).