Fire Victims Win Reversal by IRS
In a sudden reversal, the IRS said Wednesday that people who lost their homes in the Oakland hills fire last fall may take a tax deduction for interest on their mortgages.
On Tuesday, an IRS spokesman said that people could not deduct mortgage interest if the house no longer existed.
The change Wednesday came after more than 100 people called to complain about the rule.
Word of the change came after lawyers for the tax agency held a six-hour meeting in Washington to discuss the problem, said Larry Wright, an IRS spokesman in San Francisco.
“I’m the happiest I’ve been in awhile,” Wright said Wednesday. “I can now go back into Oakland and eat in a restaurant.”
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