IRS in Houma to help Road Home recipients

Tri-parish storm victims who received Road Home funds now struggling with 2007 tax questions may find answers at today’s town hall meeting in Houma.

The Internal Revenue Service is hosting three sessions – two for individual taxpayers and the third for Certified Public Accountants – at Terrebonne Parish Library’s Main Branch. The meetings for taxpayers are set for 8:30 to 10 a.m. and 1:30 to 3 p.m. IRS agents will meet CPAs and other tax practitioners from 11 to 12:30 p.m.

Tax preparation has been complicated for hurricane survivors who declared a casualty loss in 2005 and received a Road Home grant because the casualty loss amount must be added to their 2007 income. Many homeowners have found themselves in a higher tax bracket and as a result, are required to pay far more than their 2005 deduction.

The town meetings are designed to clarify filing questions from taxpayers and CPAs.

Just last week, the Senate approved an amendment to the proposed 2009 budget that would provide tax relief for certain recipients of Road Home grants.

After hurricanes Katrina and Rita, homeowners who claimed a casualty loss deduction are now required to pay the money to the IRS if they also received Road Home monies.

Immediately after the 2005 hurricanes, Congress approved legislation easing restriction on such deductions to aid taxpayers affected by the storms. The rebuilding grants have elevated some homeowners into higher tax brackets, resulting in federal tax bills surpassing the savings they received after the storm.

A bill Landrieu co-sponsored is slated to be addressed in the coming days.

“They can’t pass this budget without me,” Landrieu told the Associated Press. “The IRS has thrown our homeowners into a tax nightmare with their determination that homeowners be penalized for moving swiftly to draw on resources Congress provided after the storm.”

The Associated Press contributed to portions of this article.