Tax day for Katrina victims

Marketplace Staff Oct 16, 2006
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Tax day for Katrina victims

Marketplace Staff Oct 16, 2006
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SCOTT JAGOW: Today’s the tax deadline for Hurricane Katrina victims. The government gave them more time to file to ease their financial burden, but also to let them take advantage of tax credits. That’s if they can. Charla Bear reports.


CHARLA BEAR: Gulf Coast residents and business owners can take Opportunity Zone tax credits when they file for the deadline tonight.

The special credits cover things like property depreciation and higher education.

But Jared Bernstein of the Economic Policy Institute says whether the credits actually help depends on how much money you have.

JARED BERNSTEIN: In terms of fed income taxes — folks at the low end, the bottom 20%, don’t pay any — so, when you forgive their tax liability, you don’t help them that much.

Bernstein says many of Katrina’s hardest hit live below the poverty line and they need more than tax credits.

BERNSTEIN: If you don’t have the basic income, resources, wealth to start a project involving, say rebuilding your home, it’s hard to imagine any tax policy that’s going to help you very much.

Bernstein also says the credits don’t really help the thousands of victims who haven’t returned to the region.

I’m Charla Bear for Marketplace.

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