Congressional Bill Aims To Offer Superstorm Tax Relief
Home and business owners whose hands are full…and wallets are empty…just trying to rebuild from the Superstorm may get some tax relief through action on Capitol Hill.
The Hurricane Sandy Tax Relief Act of 2013 (HR 2137) would temporarily relax some deduction restrictions and offer some revenue alternatives to lower the tax burden in the middle of reconstruction.
Shore Representatives Jon Runyan and Frank Lobiondo (R-NJ) co-sponsor the bipartisan measure along with Representatives Bill Pascrell, Jr. (D-NJ) and Rodney Frelinghuysen (R-NJ); Joseph Crowley, Charles Rangel and Carolyn McCarthy (D-NY); Michael Grimm and Tom Reed (R-NY); and John Larson (D-CT).
“It is modeled after what we did as a nation to help victims of Katrina,” says Lobiondo. “There were some problems after Katrina. Some may say it was hastily put together at that time. We’ve learned…and we’re hoping that this package and the flood insurance package that I’ve introduced can be possibly married together.”
There are components that apply to individuals, businesses, communities and housing aid.
- Adjusted gross income limits for theft or loss deductions would be waived to allow inclusion of uninsured losses.
- The ceiling on allowable charity contributions would be raised with respect to cash donations to specified tax-exempt groups engaged in Hurricane Sandy relief.
- Affected families would be able to use their prior year earnings to calculate earned-income and child tax credits.
- Owners of retirement savings accounts would be given access to draw from them, without penalties, if their principal home is in the disaster region and was damaged, and if the amount is repaid in three years.
- Business owners could expense the cost of disaster recovery.
- Business operators with no tax liabilities would be allowed to use net operating loss to recover earlier tax payments or reduce future ones.
- New markets tax credits would be increased to encourage investement in community development groups serving storm-damaged areas.
- Public utilities would be permitted to reduce tax liabilities when rebuilding or replacing storm-damaged equipment and assets.
- Displaced workers would have work opportunity tax credits available.
Public and Municipal Assistance
- The bill would provide a state-by-state private activity bond allocation to rebuild piers, docks, commuting centers and certain types of housing along with water, sewage and solid waste infrastructure, and eletricity or natural gas facilities.
- The measure calls for increased allocation of the Low Income Housing Tax Credit in the impacted region.
- Certain mortgage revenue bond requirements would be eased to free up working capital.
The measure must travel through committee before reaching a full vote in the House and must also clear the Senate. Lobiondo expresses confidence of quick passage.