WASHINGTON -- Sen. Chuck Grassley of Iowa today welcomed IRS guidance to help Iowa businesses and public utilities rebuild after the floods and storms of 2008. The guidance came after Grassley pushed the agency to publicly answer questions about using tax-exempt bond provisions, which he included in an aid package enacted in October 2008.
“Tax-exempt bonds are a good way to help businesses and public utilities rebuild after a disaster,” Grassley said. “That’s especially true now, when the credit markets are dried up, and small businesses are having trouble getting loans. This guidance will clear up questions that have slowed down progress and get recovery projects moving.”
The IRS today released guidance on the tax-exempt bond provisions for the Midwestern and Hurricane Ike disaster areas enacted on Oct. 3, 2008. For the last year, Grassley has urged the IRS to issue the guidance because businesses and utilities that were meant to benefit from the bonds had questions in areas including qualified project costs, designations of areas of greatest need, the scope of gubernatorial discretion in these matters, and the scope of eligible financing by public utilities.
Today’s guidance, IRS Notice 2010-10, is available at http://www.irs.gov/pub/irs-drop/n-10-10.pdf.
This is the latest development in Grassley’s ongoing effort to make sure Midwestern disaster victims receive timely assistance, similar to what Congress approved after Hurricane Katrina. Last month, Grassley introduced legislation giving Midwestern disaster victims more time to benefit from tax relief intended to help them repair or replace their devastated homes.
Last year, Grassley wrote the Heartland Disaster Tax Relief Act of 2008, signed into law on October 3, 2008. The measure gave temporary tax relief to people in the Midwestern disaster area, which experienced severe floods and tornadoes in spring 2008. The tax relief is similar to what Congress provided for people impacted by Hurricane Katrina in 2005.
Grassley was instrumental in securing help for Midwestern disaster victims. Last year’s legislation included a $4.6 billion disaster tax relief package exclusively designed to help Iowa and nine other Midwestern states recover and rebuild from the spring 2008 floods and tornadoes. The measure included another $3.5 billion for general disaster tax relief for other disasters nationwide, including those in Iowa. The tax relief is in addition to and separate from disaster recovery funds provided through the appropriations process.
The tax provisions for the Midwest were modeled on what Congress passed for Hurricane Katrina victims in 2005. They were enacted after Grassley kept the pressure on congressional leaders to take similar action for natural disaster victims in Iowa and throughout the Midwest. In 2005, while Grassley was chairman of the tax-writing committee in the Senate, a major individual tax relief package was signed into law within three weeks of the Katrina disaster. A few months later, Congress followed up with an infrastructure and business relief tax package.
Grassley is ranking member and former chairman of the Committee on Finance, with exclusive Senate jurisdiction over tax policy.