Congressman Mike Fitzpatrick (PA-8) has recently joined a bipartisan group of 15 Republicans and 15 Democrats in Washington D.C. in introducing the Natural Disaster Tax Relief Act. This bill will provide much needed tax relief to communities across the United States which have been devastated by natural disasters, including those at home.
“As recently as Hurricane Sandy to storms back while I was county commissioner, I’ve long understood the damaging effects of natural disasters on Bucks County and our region,” said Fitzpatrick. “For thousands of our friends and neighbors these unforeseen disasters disrupt can lives, and leave homes and family budgets destroyed in their wake. This bipartisan bill aims to provide some much needed assistance to those most affected by these acts of nature.”
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In 2013 alone there were 7 weather and climate disaster events with losses exceeding $1 billion each across the United States. These events included five severe weather and tornado events, a major flood event, and the western drought/heat wave.
In Bucks, most notably, residents felt the damage of the record-breaking Hurricane Sandy, which left millions in and around the east coast without power, drowned numerous properties, and sent trees flying down in heavy wind gusts.
“These policies transcend politics and offer a hand-up for those dealing with the life-altering effects of natural disasters,” added Fitzpatrick. “This bipartisan legislation will help families in Bucks and Montgomery counties make ends meet when dealing with the financial challenges of a devastating storm, and give all Americans peace of mind that there are policies to help them even in their darkest hour.”
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This new bill will cover federally-declared disasters from 2012 through 2014 with a variety of assistance measures, including:
- Allows deduction for disaster cleanup expenses;
- Allows homeowners who lost their homes to qualify for financing provided under tax-exempt mortgage revenue bonds;
- Waives the 10% penalty tax that would otherwise apply on an early withdrawal from a retirement plan for disaster victims;
- Permits disaster victims to use prior year’s income for purposes of calculating the earned income and child tax credits;
- Increases the Low-Income Housing Credit allocation for states damaged by a natural disaster, based on the population of qualified disaster areas within the state; and
- Allows businesses to create a natural disaster fund, whereby they could set aside pretax dollars for natural disaster expenses, including insurance deductibles and coinsurance.
