Information For Homeowners With Crumbling Foundations
A Crisis Affecting More Than Three Dozen Towns Across North-Central Connecticut
In recent years, more and more homeowners in our region have discovered that their home foundations are crumbling due to the presence of a mineral called pyrrhotite in the stone aggregate originally used to mix the concrete. During this time, I have met with affected homeowners, attended community forums, and discussed the matter with town officials and state legislators from the impacted regions. The high cost of repairs for homeowners, the prevalence of the problem in our region, and the potential economic impact to the state require a comprehensive response. I have been a persistent advocate for such a collaborative approach and I will continue to organize state and local officials, federal agencies, private industry, and other stakeholders to address this crisis head-on.
Courtney speaks to a homeowners group about crumbling foundations in 2015
Resources for Homeowners
- NEW INFORMATION: Click here to read the latest guidance from the IRS extending the period people can make home repairs through the end of 2020, and claim a write-off by revising their 2017 tax return through April 2021. (IRS Revenue Procedure 2018-14)
- Click here to read an updated letter from the IRS regarding 2017 tax returns
- Click here to read the IRS's guidance for homeowners with crumbling foundations looking deduct the cost of repairs from their federal taxes (IRS Revenue Procedure 2017-60)
- If your home may be affected by crumbling foundations, you can file a complaint with the Department of Consumer Protection here.
- For additional information or questions, contact the Connecticut Department of Consumer Protection at 1-800-842-2649 or email email@example.com.
- The Department of Consumer Protection has also issued a warning to homeowners to be wary of scams to repair or replace faulty concrete. I urge consumers to take precautions before making any payments or signing contracts--read more here about ways to avoid scams.
- Click here to read the Connecticut Insurance Department's notice directing insurers not to cancel homeowner's policies as a result of concrete foundation issues.
- Click here to read the Connecticut Department of Consumer Protection's brochure for homeowners.
- In 2016, the Connecticut General Assembly passed, and Governor Malloy signed, Public Act 16-45, which allows homeowners with crumbling foundations to adjust their property assessments. Call your town assessor for assistance with this process. Click here to read the law
- Some municipalities in the affected region have decided to waive local building and permitting fees associated with construction and repairs to homes with crumbling foundations. Call your town officials for further information on your town’s policies.
Courtney hosts a seminar at Ellington High School with a senior certified public accountant (CPA) at the IRS, Joseph S. McCarthy, for homeowners and contractors to learn more about the IRS Casualty Loss Deduction procedures in May 2018
What I am Doing
On November 22, 2017, Congressman John Larson and I announced that the IRS approved our request for a "revenue procedure," a guidance document that allows homeowners with crumbling foundations to deduct the cost of repairs from their federal taxes as a casualty loss. In the months leading up to this decision, we discussed this problem with key federal officials, including former IRS Commissioner John Koskinen, National Taxpayer Advocate Nina Olson, and Secretary of the Treasury Steven Mnuchin, who made it clear that federal agencies understand the deep impact of this problem. The guidance issued by the IRS will now allow homeowners to deduct the cost of repairs made to home foundations for pyrrhotite-related damage on returns, and amended returns, moving forward. Homeowners can read the guidance here and consult with their professional tax preparer to determine whether their repairs qualify.
In August 2016, I received confirmation from the U.S. Department of Housing and Urban Development (HUD) that federal grant programs including the Community Development Block Grant and the HOME Investment Partnership program could be used to support housing remediation costs in communities affected by crumbling foundations. Connecticut already receives funding through this program annually to support housing initiatives across our state, and some of the funding has been targeted to support our region's response. I have worked extensively with local legislators, state agencies, and HUD staff to share information and assist in using this funding to alleviate the burden of crumbling foundations.
In addition to those two programs, in September 2017, the U.S. House of Representatives unanimously passed three amendments I authored along with Congressman Larson. These amendments would support our efforts with the IRS and HUD, as well as the National Institute of Standards and Technology, which could issue standards for pyrrhotite content in residential construction to help prevent a similar pyrrhotite-related problem in the future. While the amendments have not become law, this vote was the first time a chamber of the U.S. Congress expressed support for assisting Connecticut homeowners.
The response to this crisis must address the central problem of damaged homes as well as related issues, including questions regarding property-casualty policy changes, outstanding mortgage debt held by homeowners, and the impact of this problem on municipal budgets. I remain committed to investigating every possible source of federal assistance that may be available to local homeowners who need help, and I will continue my regular communications with state and local officials to develop the comprehensive solution this crisis requires.
As the state coordinates further assistance and information for homeowners, my office is always available as a resource for eastern Connecticut constituents. Please feel free to call my office at 860-886-0139 or email me with any questions.
More on Information For Homeowners With Crumbling Foundations
If you are a tax preparer in northcentral Connecticut and would like to learn more about the webinar tomorrow afternoon, please contact the Norwich district office at 860-886-0139.
What: Webinar for tax preparers to learn more about the Casulty Loss Deduciton for frumbling foundation repairs.
When: Monday, May14, 2018 at 10:00 AM
55 Main Street, Suite 250
Norwich, CT 06360
Phone: (860) 886-0139
Fax: (860) 886-2974
By: Eric Bedner
The IRS has determined that homeowners who make repairs to their crumbling foundations within the next three years can amend their 2017 federal tax filings to deduct the cost.
Under the updated guidance from the IRS, which U.S. Reps. John B. Larson, 1st-District; Joseph D. Courtney, 2nd-District; and Rihard Neal of Massachusetts announced Wednesday, homeowners will have through the end of 2020 to make qualified repairs to their homes and until April 2021 to claim those repairs on amended 2017 federal tax return.