the allocation is requested. (C) Application of carryforward Paragraph (3) shall be applied separately with respect to the amount of any increase under subparagraph (A). (D) Covered federally declared disaster area For purposes of this paragraph, the term covered federally declared disaster area means any disaster area with respect to which a federally declared disaster is declared which occurs after December 31, 2011, and before January 1, 2023. For purposes of the preceding sentence, the terms federally declared disaster and disaster area have the meanings given such terms in section 165(i)(5). . (b) Effective date The amendments made by this section shall apply to calendar years beginning after December 31, 2016. 104. Exclusions of certain cancellations of indebtedness by reason of disasters (a) In general Section 108 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection: (j) Discharge of indebtedness for individuals affected by disasters (1) In general Except as provided in paragraph (2), gross income shall not include any amount which (but for this subsection) would be includible in gross income by reason of any discharge (in whole or in part) of indebtedness of a natural person described in paragraph (3) by an applicable entity (as defined in section 6050P(c)(1)) during the applicable period. (2) Exceptions for business indebtedness Paragraph (1) shall not apply to any indebtedness incurred in connection with a trade or business. (3) Persons described A natural person is described in this paragraph if, with respect to any federally declared disaster occurring after December 31, 2011, and before January 1, 2023, the principal place of abode of such person on the applicable disaster date was located in the disaster area. (4) Applicable period For purposes of this subsection, the term applicable period means the period beginning on the applicable disaster date and ending on the date which is 24 months after such date. (5) Other definitions For purposes of this