Shoah Survivors in California to Get Tax-exempt Reparations

Holocaust survivors who live in California can now reap a tax benefit from reparations paid to them by the German government.

Legislation signed by Gov. Pete Wilson on April 8 exempts from taxation income received from the German government as reparation for property that was located in the former East Germany and that was confiscated during the Nazi regime.

The Holocaust Victim Compensation Relief Act, co-sponsored by state Sen. Bill Lockyer and Assemblywoman Sheila Kuehl, brings California’s state tax law into compliance with federal law. Under a U.S.-German treaty, reparations are not subject to federal income tax.

“We can’t undo the terrible and horrific wrongs, which, although committed long ago, remain a stain on our collective humanity,” Lockyer said. “But at least, all these years later, we shouldn’t compound the tragedy by taxing the victims.”

According to California’s Franchise Tax Board, about 200 Holocaust survivors who live in the state will benefit from the new law.

The loss of tax revenue is estimated at $250,000 annually, Lockyer said.

The legislation covers reparations received since the beginning of the 1994 tax year. California residents who received such compensation were able to file amendments with their 1995 income tax returns, said Jesus Arredondo, Wilson’s deputy press secretary.

“This legislation will allow for the full benefit and value of compensation awards to be enjoyed by the survivors of the Holocaust,” Wilson said.

Barbara Bergen, central Pacific regional director of the Anti-Defamation League, said, “While no amount of money or regained property can erase the atrocities these victims have experienced, the Holocaust Victim Compensation Relief Act is a tangible piece of legislation that helps assure survivors and the rest of the Jewish community that the government acknowledges the pain of their past.”