1,700 Families Affected by Red Hill Water Contamination Crisis Receive Tax Relief, Says IRS – According to a recent announcement from the Internal Revenue Service, people who had their drinking water tainted by jet fuel from the Navy’s Red Hill facility in November 2021 will not be required to pay federal taxes on any reimbursements they received from the military to cover costs like temporary housing, food, and personal property damage.
According to a recent announcement from the Internal Revenue Service, people who had their drinking water tainted by jet fuel from the Navy’s Red Hill facility in November 2021 will not be required to pay federal taxes on any reimbursements they received from the military to cover costs like temporary housing, food, and personal property damage. (Photo by staradvertiser.com)
An estimated 1,700 civilian families on the Navy drinking water system, which supplies areas near Joint Base Pearl Harbor-Hickam, received emergency help. Residents were outraged when affected families began receiving 1099 income forms from the IRS a few months ago claiming that they owed taxes on the relocation help.
According to records, the Joint Base Pearl Harbor-Hickam has seen a string of gasoline leaks over the previous ten years, with the most recent one occurring 11 days before the Navy revealed it had found pollution in the Red Hill well on Oahu. (Photo by edition.cnn.com)
Tax Relief for Families Affected by Red Hill Water Contamination, Says Gov. Green
Dr. Josh Green, the governor. is declaring that assistance funds granted by the federal government to meet costs will not be subject to state taxes for those families and persons negatively affected by the Red Hill gasoline crisis. An notification by the Internal Revenue Service (IRS) stated that targeted tax exemptions would be given to people and households that received assistance after being evicted from their homes due to the contamination of their drinking water.
The Congressional Delegation for the State of Hawaii wrote to IRS Acting Commissioner Douglas O’Donnell on March 2, 2023, requesting exemptions for any aid given by the Department of Defense as a result of the crisis. Section 139 of the Internal Revenue Code permits the exclusion of “Emergency and Extraordinary Expense” reimbursements from gross income calculations if the expense was not already covered by insurance. EEE reimbursements are qualifying disaster relief payments.
The IRS release contains a clarification of the tax code. In order to guarantee that the same exemptions apply for state taxes, Director Gary Suganuma of the Department of Taxation (DOTAX) will oversee the State’s compliance with IRS regulations. Additionally, DOTAX will not tax the reimbursements with state income taxes.
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Red Hill Water Contamination Update
According to a lawsuit based on recent Health Department disclosures, the Navy’s Red Hill accident in 2021 damaged drinking water that not only contained fuel but also a de-icing agent.
The “fuel system icing inhibitor” present in aviation gasoline, according to the Health Department, is not the same chemical as that present in antifreeze for automobiles. Compared to fuel system icing inhibitor, which contains diethylene glycol monomethyl ether, car antifreeze contains ethylene glycol, which is more and differently hazardous.
Attorneys suing the federal government have updated their complaint to reflect the fresh details found in a state Health Department internal memo.
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