Midwest lawmakers seek tax relief for flooding

Thursday, July 24, 2008
WASHINGTON (AP) -- Victims of recent storm and flood damage in the Midwest could get some tax relief under a new bill pending in Congress.

The nearly $4 billion measure would let disaster victims take money out of retirement plans without facing tax penalties. It also would give tax breaks to businesses that suffered losses and encourage more donations to charities.

The plan would apply to people and businesses in federal disaster areas in Iowa, Arkansas, Illinois, Indiana, Kansas, Michigan, Minnesota, Missouri, Nebraska and Wisconsin.

Lawmakers from five Midwestern states introduced the measure in the Senate and House on Thursday.

The package is modeled after similar laws that Congress passed to help victims of hurricanes Katrina, Rita and Wilma in 2005 and the massive tornado in Greensburg, Kan., last year.