IRS wants those receiving shelter grants to pay taxes on them

OKLAHOMA CITY (AP) Thousands of Oklahomans who received federal grants to build storm shelters at their homes may owe the Internal Revenue Service some money. <br/><br/>The Federal Emergency Management

Thursday, December 23rd 2004, 6:09 am

By: News On 6

OKLAHOMA CITY (AP) Thousands of Oklahomans who received federal grants to build storm shelters at their homes may owe the Internal Revenue Service some money.

The Federal Emergency Management Agency is advising communities across the state that the IRS has determined the grants, dating back to 1999, are taxable.

Statewide, 7,541 grants totaling $17.5 million have been distributed to residents who built safe rooms or had storm shelters installed. The program pays up to 75 percent of the cost of building a shelter.

Officials in Moore, where several hundred grant recipients received average awards of $2,000 each, know about the situation.

``This is sure to generate a fair amount of ill will,'' City Manager Steve Eddy said. ``All I can say is, 'Don't shoot the messenger.'''

Michelann Ooten, spokeswoman for the state Department of Emergency Management, said many of the grants went to homeowners hardest hit by the May 1999 and May 2003 tornadoes.

Some communities, like Oklahoma City, haven't been notified. Those affected also include Norman, Midwest City, Oklahoma County and Tulsa County.

Grant recipients will need to file an amended tax form. Those who received money this year will receive the 1099 tax forms.

Ooten said all recipients will be notified of the IRS decision.