Hawaii, IRS offering tax breaks to families affected by Red Hill

Families affected by the Red Hill water crisis will not have to pay state taxes on lodging, meals and other gifts received while they recover from water contamination.

Gov. Josh Green said he was following in the footsteps of the IRS, which is also exempting Red Hill recovery expenses following a request from the state's congressional delegation.

The federal agency said it would exempt taxes on emergency and expense payments for lodging and meal expenses for families that had to leave their homes, families that stayed in their homes and used potable water, and families that received money to reimburse expenses for property damage.

"Under these extraordinary circumstances, I applaud the IRS for doing what's right," Green said in a statement.

Gary Suganuma, director of the Department of Taxation, will supervise efforts to give affected residents the same break on state taxes, the governor said.

Thousands of residents were forced from their homes after a fuel leak at the Red Hill Bulk Fuel Storage Facility in November 2021. More than 1,100 gallons of aqueous film-forming foam was released in a separate incident last November. Soil tests taken earlier this year showed excess amounts of per- and poly-fluoroalkyl substances, according to the Department of Health.

The latest water quality tests are also posted on the DOH's website.

The U.S. Navy is in the process of closing the facility. The estimated completion date is August 2027, according to the Navy.