Gulf Coast residents just can’t get a break

by Justin Horwath

Some people just can’t get a break.  Take for example the employees of the tourism, fishing, and petroleum industries along the Gulf of Mexico.  Many of the have been out of work since the days following the April 20 Deepwater Horizon oil leak, just as they started getting back on their feet after hurricanes Katrina and Rita.

This last week has seen the same people face two new challenges: one natural, the other decidedly not.  The first is Tropical Storm Alex percolating in the western Caribbean.  Even if this storm does not head toward the southern United States, it signals the opening of hurricane season. There is a chance that today’s unemployed will also be tomorrow’s storm victims. 

The other challenge comes not from the sea, but from Washington.  There, President Barack Obama persuaded BP to but together a $20 billion fund for spill victims. He didn’t mention that it comes with a catch: all payments from it are taxable.

On Friday, the IRS issued a “guidance” reminding taxpayers that since the money they receive from BP is compensation for lost wages, it can and will be taxed like those wages.  

“As residents of the region cope with the evolving situation, I want to assure them that the IRS will be doing everything it can to provide tax help to those who need it,” said IRS Commissioner Doug Shulman. “Provide tax help,” in this case, means, ‘We’ll help you give us your money.’

The money they receive from BP should stay where it can do the most good and out of the tax collector’s reach. And if not, can’t Uncle Sam wait until next April?

Otherwise, go Saints….?