WASHINGTON â€” U.S. Rep. John B. Larson, D-1st District, and U.S. Rep. Joe Courtney, D-2nd District, met Monday with Treasury Secretary Steven Mnuchin and Assistant Secretary for Tax Policy David Kautter at the Department of the Treasury headquarters in Washington, D.C. to discuss assistance for north-central Connecticut residents impacted by crumbling concrete foundations.
The members wrote to the secretary earlier this summer requesting a meeting to discuss crumbling foundation relief, specifically requesting an IRS â€śrevenue procedure.â€ť
That is a guidance document that, if approved, would allow homeowners to deduct foundation repair costs from their federal taxes.
The Treasury Departmentâ€™s Office of Tax Policy directs the issuance of these documents, which are then prepared by the IRS.
â€śAfter meeting with Secretary Mnuchin and his staff today, it is clear that they are engaged on this issue and understand the urgent situation facing residents in Connecticut,â€ť Larson and Courtney said in a joint statement Monday afternoon.
â€śAfter laying the groundwork for possible coordination on crumbling foundations with the National Taxpayer Advocate earlier this year, and the Secretary during an appearance before the House Ways and Means Committee, we are pleased that he took time to meet with us once again to discuss the situation facing homeowners in our districts.
â€śWe discussed several possible options for federal assistance through the IRS and the Treasury Department, and we were encouraged by their understanding of the situation facing Connecticut homeowners and commitment to working with us toward a solution.
â€śWe will continue to work with Treasury and with the IRS as they consider legal issues in the tax code to secure some relief for homeowners.
â€śAs we have said all along, there is not going to be one silver bullet that solves the entire problem for homeowners. Instead, we need a concerted effort at the municipal, state, and federal levels and this could be an important and valuable piece of the puzzle.â€ť
Under current tax law, taxpayers may deduct a casualty loss from their income if they have suffered a sudden loss.
Citing the precedent of IRS assistance to homeowners affected by corrosive Chinese drywall in 2010, Courtney and Larson are seeking IRS guidance to allow a casualty deduction related to the longer-term damage suffered by homeowners with crumbling home foundations.
Earlier this year, National Taxpayer Advocate Nina Olson also endorsed this effort, formally submitting a letter of support and outlining how the IRS could construct the details of this policy.
The Connecticut Society of CPAs has also lent their support to this effort.