Tax Assistance for Crumbling Foundations Act Introduced to Aid Connecticut Homeowners

Strategic Insights -

Congressman John B. Larson and Congressman Joe Courtney have introduced the Tax Assistance for Crumbling Foundations Act, a bill aimed at providing federal tax assistance to Connecticut homeowners affected by the crumbling foundations crisis. The bill seeks to ensure that homeowners can continue to claim the casualty loss tax deduction for repair costs without the deadline expiring on April 15, 2021.

Key Takeaways:

  • The Tax Assistance for Crumbling Foundations Act would repeal the Tax Cuts and Jobs Act Stafford Act Presidential disaster requirement, making benefits retroactive to December 31, 2017.
  • The bill would extend the casualty loss deduction statute of limitations, allowing taxpayers to file their amended 2017 return for an additional year.
  • The measure requires the Treasury Department to issue additional regulations consistent with the first Revenue Procedure (2017-60), which provides safe harbor to crumbling foundations repairs for the casualty loss deduction.
  • The bill would be a huge step in the right direction for eastern Connecticut homeowners impacted by crumbling foundations, ensuring that federal assistance is available for years to come.
  • Reps. Courtney and Larson have worked together for years to help homeowners and others in central and eastern Connecticut, and this bill continues their efforts to provide essential tax relief.
  • Homeowners should consult with a qualified tax preparer to see if they qualify for the casualty loss tax deduction, and the IRS has clarified that certain costs not covered by CFSIC may still qualify for the tax deduction.

Statistics:

  • The deadline for taxpayers to take advantage of the federal tax assistance is April 15, 2021.
  • The bill would provide significant federal tax assistance to homeowners with crumbling foundations by restoring and extending the casualty loss tax deduction for repair costs.
  • The casualty loss deduction statute of limitations is currently set to expire on April 15, 2021, without legislative action.

Sources:

[1] United States House of Representatives -- Congressman John B. Larson.

[2] United States House of Representatives -- Congressman Joe Courtney.

[3] IRS Revenue Procedure 2017-60.

[4] The Moving Forward Act (H.R. 2).