House stalls on tax relief for Hurricanes Harvey, Irma, Maria victims that Sandy victims did not get

September 26, 2017
Washington

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Planes are scattered on the tarmac of one Puerto Rican airport and many are flipped like toys showing the power of Hurricane Maria’s winds on the island.
USA TODAY

Democrats criticized a Republican-craftedÂ disaster tax relief package MondayÂ for providingÂ victims of Hurricanes Harvey, Irma and Maria with benefits that were not approved after Superstorm Sandy in 2012.Â

The opposition kept the bill, which was introduced Friday and brought up under a special procedure, from getting the needed two-thirds majority needed for passage as an emergency item.Â Another vote, using a procedure that only requires a majority, is expected later this week.

Rep. Carlos Curbelo, a Florida Republican whose district includes the Keys, urged his colleagues during debate Monday afternoon to approve the bill quickly because people hit by the storms need help.

â€œThey donâ€™t have time to wait,â€ Curbelo said. â€œThey certainly donâ€™t have time to play political games.â€

But Rep. Bill Pascrell, D-N.J., said Congress took three months to consider an aid package after SandyÂ and then never even debated a package of tax breaks he proposed that was similar to one enacted after Hurricane Katrina devastated the Gulf Coast in 2005.

â€œCongress until then had routinely provided tax relief to communities in the wake of the worst storms,â€ Pascrell said. â€œVictims of Hurricane Sandy did not receive the same treatment. â€¦ This whole debate smacks of a certain hypocrisy.â€

House Minority Leader Nancy Pelosi, D-Calif., said in a statement early Monday that the tax provisions “donâ€™t treat all families recovering from natural disasters the same.”

House Ways and Means Chairman Kevin Brady, R-Texas, introduced a bill Friday that combinedÂ a handful of disaster-related tax breaks with an extension of funding for the Federal AviationÂ Administration, which is due to expire at the end of the week. The bill also includes a section to increase the private-sectorÂ involvement in providing flood insurance, which currently is provided almost exclusively by theÂ Federal Emergency Management Agency.

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Brady indicated the decision on Sandy could change in a future bill.

“This provision, it is not the final recovery package,” Brady said. “We were given the opportunity to accelerate the immediate needs for Harvey and Irma and Maria because the victims right now are struggling, they need the immediate help.”

Asked whether Sandy victims could ultimately be included in a future bill, Brady said, “Weâ€™re going to continue that conversation.”

Brady’s bill would provide victims of Harvey, Irma and Maria in regions where President Trump has issued a disaster declaration with tax benefits for:

Casualty losses: Currently, taxpayers canÂ deductÂ losses from their income taxes if they exceed 10% of adjusted gross income, and the taxpayer itemizes. Both of those requirements would be eliminated in the bill, so designated storm victims could write off all their losses, regardless of whether they itemize.

Retirement withdrawals:Â The bill would lift the 10% penalty on withdrawing funds from many retirement accounts, including IRAs, to pay for disaster recovery. It also wouldÂ provide more flexibility for borrowing fromÂ accounts.

Expanded charitable deductions:Â The current limit on deducting charitable contributions â€”Â taxpayers generally can only deduct 50% of their income â€” would be lifted for donations to hurricane relief, so people making large gifts could write more of them off. It would also change rules for applying large write-offs to multiple years of tax returns.Â

Employment relief: A tax credit would be providedÂ of 40% of wages, up to $6,000 per employee for a disaster-affected employer from a core disaster area.

Special rules: Taxpayers could use income from last year to determine whether they are eligible for the Earned Income Tax Credit or Child Tax Credit.Â

The legislation would also extend authorization of the FAAÂ and its funding, which is now slated to expire Saturday, until March 31.

FAA functions such as air-traffic control, which guides planes across the skies, are considered essential services and have continued to operate during previous funding lapses. But the risk to the government is an inability to collect taxes on tickets that airlines sell, which fund the system.

Lawmakers complained that when a two-week lapse occurred in 2011, most airlines continued charging the same fares without passing along tax savings that can total about one-fifth of the average ticket price to passengers.

Contributing: Bart Jansen

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Residents at La Perla community in Old San Juan comfort People sit in their apartment on Sept. 25, 2017 with La Perla resident Maritza Rosado stands inside her Residents from La Perla carry a piece of metal through People wait in line to get a flight at the Luis Munoz A damaged home is seen as people deal with the aftermath A resident of La Perla community in Old San Juan rests An American Airlines employee checks a passenger's La Perla resident Ramon Marrero, 76, looks at his battered People line up to get gas as they deal with the aftermath La Perla resident Maria Antonia Perez Rivera looks Trees are reflected in the water in the Buena Vista A woman collects water from a natural spring created Water drains from the Guajataca Dam in Quebradillas, People survey the overflow from Lake Guajataka in San Overflow from the damaged Guajataka River Dam is seen People clean up the debris after Hurricane Maria passed Vehicles drive along a flooded road on Sept. 23, 2017 U.S. Coast Guard MST-2 Annaliese Ennis surveys the U.S. Coast Guard personnel survey the damage to an A pedestrian walks along a barrier next to a flooded People wait in line to purchase petrol in Arecibo, Cars remain on a flooded street in San Juan, Puerto A man rides a bike through high water in Loiza, Puerto Residents stand amid rubble Sept. 22, 2017 in Roseau, A partially collapsed bridge is seen Sept. 22, 2017 U.S. Coast Guard personnel offload relief supplies, Residents dismantle a roof days after Hurricane Maria A resident clears debris, Friday, days after Hurricane Police officers stand guard at a gas station in San National Guard personnel evacuate Toa Ville resident A man wades through a flooded road, past a boat, in An aerial view of Roseau, capital of the Caribbean People sit in their home in El Negro, Puerto Rico, A resident walks on a flooded road after the passing People queue in line to withdraw money from an ATM Residents attempt passage through a flooded road in People waiting line to buy gas are seen in Rio Hondo, Isabella, age 10 rescues her photos from her flooded A woman stands on crutches, Friday, in her house after Slt Dawkins, left, and Slt Marks clear debris at Nanny National Guard personnel offer evacuation to a Toa Dominican Republic President Danilo Medina, right, A view of the damage caused by the passage of Hurricane This shows Canefield on the island of Dominica BEFORE A man stands in the flooded street outside his house, Personnel from a FEMA search and rescue crew walk in Sections of Loza, Puerto Rico, flooded badly in the Inhabitants stand in flood water in front of a house People walk across a flooded street in Juana Matos, A man walks past a house laying in flood water from The road to Loza, Puerto Rico, was nearly impassable People walk in a flooded street next to damaged houses A man walks in his house that was destroyed by Hurricane Three men walk between downed power lines in the aftermath A gift shop is damaged as Hurricane Maria crosses Cofrecito A person looks at damaged homes in the La Perla neighborhood A bicyclist rides past a damaged gas station the day A destroyed shack is seen in the Rio Piedras area,
Gerald Ramirez, 5, left, and Deyanery Ramirez, 3, right, look down Calle San Miguel in the La Perla neighborhood on Sept. 21, 2017, in San Juan, Puerto Rico. The majority of the island has lost power, in San Juan many are left without running water or cell phone service, and the governor said Maria is the “most devastating storm to hit the island this century.”Â
Alex Wroblewski, Getty Images Damaged homes in the La Perla neighborhood the day A sign from a gas station lies in rubble as Hurricane The Courtyard Marriott Isla Verde in San Juan lost A man rides his motorbike through a flooded street Streets and highways around San Juan were turned into Flooded streets and downed power lines littered San Streets around San Juan were clogged with downed trees A car is stuck in a flooded street in in San Juan, A tree blocks a street in San Juan, Puerto Rico. Hurricane A woman covers herself with a plastic bag as she makes People deal with the damage caused by Hurricane Maria A few lights are visible in San Juan, Puerto Rico, Men walk damaged trees after the passage of Hurricane People navigate downed trees and power lines after A woman pushes children as members of the military A resident of the Puerto Nuevo neighborhood walks through Concrete power line poles lie on a highway after the A damaged sail boat washed ashore is seen after the A woman is transported to a shelter by search and rescue Residents of San Juan, Puerto Rico, deal with damage Tree branches cover a street in the aftermath of Hurricane Adriana Rosado, 21, Jorge Diana, 24, and their 2-month Rescue team member Jonathan Cruz cries on the floor Residents seek shelter inside Roberto Clemente Coliseum Members of a rescue team embrace as they wait to assist Trees are toppled in a parking lot at Roberto Clemente A man passes through a door at Roberto Clemente Coliseum Rain and wind hit a parking lot in San Juan, Puerto The flooded waterfront in Fort-de-France, on the French People look at the damage to a restaurant in Le Carbet, A boat lays on its side off the shore of Sainte-Anne Men clear fallen tree branches in a road in the village An uprooted tree covers a small house in the village Winds lash the coastal city of Fajardo as Hurricane People wait for the arrival of Hurricane Maria at the Librada waits for the arrival of Hurricane Maria at Evacuees pray at the Juan Ponce de Leon Elementary A woman closes her property in the coastal area of Residents cover windows as they prepare for a direct Jose Santos, a resident of Barrio Obrero, stocks up People walk by a fallen tree off the shore of Sainte-Anne In San Juan's Condado neighborhood, a mix of tourist
In San Juan’s Condado neighborhood, a mix of tourist hotels and residential neighborhoods, open-air cafeterias served patrons lunch and people went about their business. Cixto CalderÂ—n sold $5 bunches of quenepas, small, sweet lime-like fruits purported to have medicinal qualities, such as stress relief and a cancer combatant, from the trunk of his car.
CalderÂ—n, 57, was later going to ride out the hurricane in his nearby home. “I’m making a little money but this is also a service to the people,” he said. “This will relieve their stress, takes their mind off Maria.”Â
Rick Jervis, USA TODAY These rocks were swept by strong waves onto a road Men remove boats from the water ahead of Hurricane Heber Hernandez, a store owner who has lived and worked Members of the Guadeloupe Adapted Military Service This is a flooded street in Pointe-a-Pitre after the Residents nail a board over a window in Trois-Rivieres, Men board up buildings ahead of Hurricane Maria in People look at the ocean in Basse-Terre, on the French Motorists fill their cars at a gas station in the north A man carries water bottles as people buy provisions Men remove a boat from the water ahead of Hurricane