Government Funds Available to Replace Underground Tanks
As discussed in previous issues of Comfort Line, grants are available from the New Jersey Underground Storage Tank Remediation Upgrade and Closure Fund to help pay the costs of removing your underground oil tank and replacing it with an aboveground tank.
This fund provides grants of up to $3,000 to cover the costs of removing an underground tank and installing a replacement tank on a prospective basis, before the tank leaks. If you install two replacement tanks, you can qualify for a second grant of up to $1,800. In order to qualify for a grant you must show the following:
- Your taxable income, as shown on your Form 1040, must be less than $250,000 per year.
- Your net worth, excluding equity in your principal residence and any pension or retirement plan funds, must be less that $500,000.
- You must demonstrate that your annual expenses are at least 51% of your annual taxable income.
Generally, if you meet the income, net worth and expense tests, the way to qualify for the grant is to first determine if the tank is leaking by installing a new tank and removing your underground tank. If the tank is not leaking, the grant application is filed with the New Jersey Economic Development Authority (EDA). If the tank is leaking, a different grant application is filed with the New Jersey Department of Environmental Protection (NJDEP).
In the case of a leaking tank, the grant can also cover environmental cleanup costs. Whether the grant application is filed with the EDA or the NJDEP, there is a non-refundable $250 application fee for each grant. These grants can also be used in conjunction with Environmental and Tank Replacement Programs. Grants received from the state fund are not subject to income tax.
Grant applications for non-leaking underground tanks are available on the EDA website at www.njeda.com. Grant applications for leaking underground tanks are available on the NJDEP website at www.nj.gov/dep. These applications are generally not filed until after the underground tank has been removed.
While the fund currently contains approximately $100 million, we anticipate a large number of grant applications being filed. Therefore, if you are interested in taking advantage of this opportunity to upgrade your tank, we encourage you to do so as soon as possible while funds are still available.
Hart & Iliff can install a new tank for you and arrange for the removal of your underground tank. If you have questions about the UST Fund, want information or need help with the forms, call us at 973-383-1421.
