Los Angeles City Councilman Paul Koretz, 5th District, has introduced resolutions to provide tenants with an additional cushion against the impact of being evicted from apartments.

The resolutions call on Congress and the state Legislature to pass laws offering dislocated tenants a tax exemption on relocation assistance they receive from landlords. The resolutions, which were referred to the council’s Rules, Elections and Intergovernmental Relations Committee, urge the city council to make seeking the tax exemptions a formal part of the city’s legislative program.

“In today’s overheated real estate market, evictions are an unfortunate fact of life,” Koretz said. “While the council is looking for more ways to preserve existing housing in the context of respecting the constitutional property rights of apartment owners, we should be doing more to ease the transition for dislocated tenants. Between the state and federal rates, taxing legally-mandated relocation assistance reduces its buying power by upwards of 40 percent.”

The city’s current relocation assistance rates range from $7,900 to $19,700, depending upon a tenant’s age, income status and length of tenancy.

In addition to tax liability, seniors who have taxable incomes inflated by relocation payments can face increases in their Medicare premiums, Koretz said.

Current law offers tax deductions only for job-related moving expenses and evictions from federally-funded housing. With thousands of L.A. tenants losing their homes as developers take advantage of laws that allow them to close down buildings using the state Ellis Act, or negotiate lease buyouts to persuade tenants to voluntarily vacate their units, tenants are thrust into a hostile rental market that has become too expensive for them to find new housing, Koretz said.

Even with L.A.’s relatively generous relocation assistance or negotiated lease buyouts, many tenants often can’t afford comparable units in their neighborhoods because market-rate rents have risen dramatically in recent years.

“If we can make this happen, we can help dislocated tenants in effect get the full value of their relocation assistance,” Koretz said. “We owe it to people having their lives disrupted this way to make sure their relocation dollars can stretch as far as possible.”