Tax exemptions maintained
Volunteer fire department bonds and loans will continue to be tax exempt under the new federal tax code, according to William V. Roth, Jr., who was a member of the Senate-House conference committee that worked out final provisions of the new law.
In a letter to E. James Monihan, chairman of the National Volunteer Fire Council (NVFC), Roth said the Tax Reform Act of 1986 “retains the present law treatment” of volunteer department financial obligations.
Under the current law, bonds and loans issued to qualified volunteer fire departments for the acquisition, construction, reconstruction, or improvement of a fire station or a fire truck are tax exempt.
According to Monihan, NVFC fought hard to win tax-exempt status for volunteer department loans and bonds under the old tax code and to preserve that status during consideration of the new Tax Reform Act.
The NVFC will continue to monitor developments as the new tax code is implemented, to assess the potential impact of other provisions on volunteer departments, says Monihan.
