Hurricane Tax Relief Floated For Sandy Victims

A bipartisan coalition of Northeastern politicians are looking to provide tax relief to for Superstorm Sandy victims. USA Today is reporting that the lawmakers would also like to link their proposed tax relief package with aid to Oklahoma tornado victims.

The current proposal includes a temporary lift on tax penalties for Sandy victims who reach into their IRAs or 401k retirement plans as long as they repay them within three years. The hope is that victims would use this cash to help rebuild.

USA Today laid out other aspects of the bill:

Other proposed provisions include waiving limits on deductions for personal losses, allowing families in the disaster zone to use their previous year’s earnings to calculate their child tax credit and the federal Earned Income Tax Credit, and increasing the limit on deductions for certain charitable donations.

Businesses could expense the cost of disaster recovery and use net operating losses to recover past tax payments.

Opposition for a tax bill targeted at East Coast victims alone will not be easy to overcome, so lawmakers are hoping to strike a deal that would link the package with aid expected to be approved for Oklahoma tornado victims.

“As we deal with disaster relief in general, I’m sure we are going to have to deal with some sort of package,” Republican Representative Tom Reed told USA Today.