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News Release from Comptroller Susan Combs

For Immediate Release
September 12, 2008

Comptroller Susan Combs Advises Hurricane Ike Victims That Some
Recovery Services Are Non-Taxable

Comptroller Also Postpones Tax Deadlines for Hurricane Victims

Complete Hurricane-Related Tax Information Available Online

(AUSTIN) —To assist Texans whose homes and businesses are damaged by Hurricane Ike, Texas Comptroller Susan Combs has created a one-stop Web page for hurricane-related tax information.

“Information about tax rules and other storm-related topics is now in one easy-to-use location on our Web site,” Combs said. “When a disaster strikes and the Governor issues a disaster declaration, the law provides tax exemptions for certain cleanup and recovery services, hotel stays, certain fundraisers for storm victims, and purchases made with vouchers or debit cards provided by relief organizations.”

The Comptroller’s Hurricane Ike information page is located at http://www.window.state.tx.us/disaster/

“Our thoughts and prayers go out to all Texans whose lives and property are in jeopardy as Ike bears down on our coast,” Combs said. “Hopefully, the storm will turn out to be less damaging than predicted. But I am committed to ensuring that unnecessary taxes are not added to the cost of recovery.”

Below are some of the storm recovery-related expenses that may be exempt from state and local sales tax. For detailed information, see the Comptroller’s Hurricane Ike Web page.

  • The cost of labor to repair storm damage to non-residential property, including offices, stores and other commercial buildings. The cost of labor must be separately stated on the repair bill.
  • Texas never imposes sales tax on labor for residential repairs.
  • Services used to restore storm-damaged property, including dry cleaning of clothing and draperies; rug and carpet cleaning; furniture cleaning; and appliance repairs.
  • Charges for cutting storm-damaged or downed trees. Charges to haul away trees and limbs are taxable, as are charges to haul away other storm debris.
  • Certain charges related to mold remediation.
  • Purchases made with vouchers or debit cards provided by FEMA, the Red Cross, and the Salvation Army. Storm-related purchases made with cash donations or personal funds are subject to sales tax.
  • For evacuees taking shelter in hotels and motels, the Governor has waived state and local hotel taxes for a 14-day period that began September 8. Storm victims who remain in a hotel for 30 days or more may claim an exemption for their entire stay.

“If you have any questions about paying tax on storm recovery services of any kind, please check our Web site or call us at (800) 252-5555. We’ll be glad to help,” Combs said. “More information will be added to the Web site as Texas’ response to Hurricane Ike unfolds in the coming days and weeks.”

The Comptroller also announced that businesses damaged by Hurricane Ike may postpone paying state taxes, if necessary, while they clean up wind and flood damage. Upon request, taxpayers may be granted an extension of up to 90 days to file state tax returns due in September and October. To request an extension, contact the Comptroller’s office at (800) 252-5555.

The Governor has issued a disaster declaration for 88 Texas counties, making residents and business owners in those counties eligible for tax relief authorized by law. The affected counties include Anderson, Angelina, Aransas, Archer, Austin, Bee, Bell, Bexar, Bowie, Brazoria, Brazos, Brooks, Calhoun, Cameron, Cass, Chambers, Cherokee, Collin, Colorado, Comal, Dallas, Denton, DeWitt, Ellis, El Paso, Fort Bend, Franklin, Galveston, Goliad, Grayson, Gregg, Hardin, Harris, Harrison, Henderson, Hidalgo, Hill, Hopkins, Hunt, Jackson, Jasper, Jefferson, Jim Hogg, Jim Wells, Kaufman, Kenedy, Kleberg, Lamar, Lavaca, Liberty, Lubbock, Matagorda, McLennan, Montgomery, Nacogdoches, Navarro, Newton, Nueces, Orange, Panola, Parker, Polk, Potter, Randall, Refugio, Sabine, San Augustine, San Jacinto, San Patricio, Shelby, Smith, Starr, Tarrant, Titus, Tom Green, Travis, Trinity, Tyler, Van Zandt, Victoria, Waller, Walker, Webb, Wharton, Willacy, Williamson, Wise and Wood counties.

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Find details on all the services of the Comptroller’s office at www.window.state.tx.us, including a transparent look at state spending at www.window.state.tx.us/wherethemoneygoes.

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