Residents of and businesses located in 88 Texas counties that were declared disaster areas as a result of Hurricane Ike are eligible for certain state tax relief as they recover from the storm's devastation.
Since Texas has no individual income tax, most of the relief for residents comes via exemptions from state and local sales taxes.
Businesses are afforded similar sales tax relief, as well as some other specific tax considerations. Texas Comptroller Susan Combs noted that owners of businesses damaged by Hurricane Ike may postpone paying state taxes, if necessary, while they clean up wind and flood damage. They also may request extensions of up to 90 days to file state tax returns due in September and October.
The sales tax exemptions for Texas businesses and individuals include:
- 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. The state 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, however, still are subject to sales tax.
For evacuees taking shelter in hotels and motels, the Gov. Rick Perry has waived state and local hotel taxes through Sept. 21. Storm victims who remain in a hotel for 30 days or more may claim an exemption for their entire stay.
Additional details, including the list of affected counties, can be found in this Texas State Comptroller announcement regarding Hurricane Ike tax breaks.