IRS GRANTS CFO SINK’S REQUEST THAT MSFH GRANTS NOT BE
SUBJECT TO FEDERAL INCOME TAX |
Florida Chief Financial Officer Alex Sink announced grants awarded to
homeowners through the My Safe Florida Home (MSFH) program will not be
reported as taxable income to the federal government.
CFO Sink made the announcement after receiving a Letter Ruling from the
Internal Revenue Service (IRS) stating that MSFH grants will be excluded
from “gross incomes for federal income tax purposes.”
“Floridians taking personal responsibility to harden their homes and receive
a grant from the My Safe Florida Home program shouldn’t be hit with an
additional tax bill in January 2008,” said CFO Sink, who runs the Department
of Financial Services and the MSFH program. “I commend the IRS for granting
our request that mitigation grants should not be considered part of a
Following a June 2007 request from CFO Sink, the IRS issued a Letter Ruling
in late November that all grants given through the MSFH program will not be
considered income and will not be reported as income to the federal
government. Without this recent ruling, matching grant recipients could have
been facing a tax liability of $1,250 on a $5,000 MSFH grant, based on the
IRS Flat Tax calculation rate of 25 percent. With $8.6 million in grants
issued to date, CFO Sink’s request has potentially saved Floridians from
being subject to approximately $2.15 million in additional federal income
The MSFH program resumed offering wind inspections and expanded statewide in
April 2007 after conducting a pilot program during the previous year. During
the last 7 months, the MSFH program has performed approximately 114,000 free
wind inspections, and a total of 127,816 inspections since the program
began. Approximately 15,985 homeowners have been approved to receive
matching grants and are working with the MSFH program to harden their homes.
Statewide, the program has issued a grand total of more than 2,637 grants to
homeowners for more than $8.6 million.
CFO Sink has reported that the vast majority of homeowners who have received
free wind inspections from the MSFH program are eligible for discounts on
their wind insurance premiums without making a single improvement to their
homes. To date, 95,807 (76 percent) of participating homeowners are eligible
for an average discount of $210 on their wind insurance premiums, based on
the current structure of the home during the free MSFH wind inspection. Over
the last seven months, the program has alerted Floridians to a potential
savings in windstorm insurance premiums totaling more than $20 million.
Any Floridian who lives in a single-family, site-built home is eligible for
a free wind inspection through the program. Floridians can apply on-line at
www.MySafeFloridaHome.com or by calling the program toll-free at
1-866-513-6734. Homeowners who receive free wind inspections through the
MSFH program will get a detailed inspection report, complete with additional
eligibility information on matching grants and estimated insurance premium
discounts, if the homeowner is eligible.
In order to be eligible for the program’s matching grant reimbursements of
up to $5,000, the Legislature requires that homeowners meet the following
requirements: have received a completed wind inspection after May 1, 2007;
live in a single-family, site-built home built before March 1, 2002; have a
valid homestead exemption; have an insured value of $300,000 or less; and be
located in the wind-borne debris region.
Additionally, while the free wind inspections will still cover seven
potential wind-resistance improvements, matching grants may only be applied
to opening protections, including windows, exterior doors and garage doors,
as well as the bracing of gable ends.