[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2778 Enrolled Bill (ENR)]

        H.R.2778

                       One Hundred Fourth Congress

                                 of the

                        United States of America


                          AT THE SECOND SESSION

         Begun and held at the City of Washington on Wednesday,
   the third day of January, one thousand nine hundred and ninety-six


                                 An Act


 
To provide that members of the Armed Forces performing services for the 
 peacekeeping efforts in Bosnia and Herzegovina, Croatia, and Macedonia 
shall be entitled to tax benefits in the same manner as if such services 
        were performed in a combat zone, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. TREATMENT OF CERTAIN INDIVIDUALS PERFORMING SERVICES IN 
              CERTAIN HAZARDOUS DUTY AREAS.

    (a) General Rule.--For purposes of the following provisions of the 
Internal Revenue Code of 1986, a qualified hazardous duty area shall be 
treated in the same manner as if it were a combat zone (as determined 
under section 112 of such Code):
        (1) Section 2(a)(3) (relating to special rule where deceased 
    spouse was in missing status).
        (2) Section 112 (relating to the exclusion of certain combat 
    pay of members of the Armed Forces).
        (3) Section 692 (relating to income taxes of members of Armed 
    Forces on death).
        (4) Section 2201 (relating to members of the Armed Forces dying 
    in combat zone or by reason of combat-zone-incurred wounds, etc.).
        (5) Section 3401(a)(1) (defining wages relating to combat pay 
    for members of the Armed Forces).
        (6) Section 4253(d) (relating to the taxation of phone service 
    originating from a combat zone from members of the Armed Forces).
        (7) Section 6013(f)(1) (relating to joint return where 
    individual is in missing status).
        (8) Section 7508 (relating to time for performing certain acts 
    postponed by reason of service in combat zone).
    (b) Qualified Hazardous Duty Area.--For purposes of this section, 
the term ``qualified hazardous duty area'' means Bosnia and 
Herzegovina, Croatia, or Macedonia, if as of the date of the enactment 
of this section any member of the Armed Forces of the United States is 
entitled to special pay under section 310 of title 37, United States 
Code (relating to special pay; duty subject to hostile fire or imminent 
danger) for services performed in such country. Such term includes any 
such country only during the period such entitlement is in effect. 
Solely for purposes of applying section 7508 of the Internal Revenue 
Code of 1986, in the case of an individual who is performing services 
as part of Operation Joint Endeavor outside the United States while 
deployed away from such individual's permanent duty station, the term 
``qualified hazardous duty area'' includes, during the period for which 
such entitlement is in effect, any area in which such services are 
performed.
    (c) Exclusion of Combat Pay From Withholding Limited to Amount 
Excludable From Gross Income.--Paragraph (1) of section 3401(a) of the 
Internal Revenue Code of 1986 (defining wages) is amended by inserting 
before the semicolon the following: ``to the extent remuneration for 
such service is excludable from gross income under such section''.
    (d) Increase in Combat Pay Exclusion for Officers to Highest Amount 
Applicable to Enlisted Personnel.--
        (1) In general.--Subsection (b) of section 112 of such Code 
    (relating to commissioned officers) is amended by striking ``$500'' 
    and inserting ``the maximum enlisted amount''.
        (2) Maximum enlisted amount.--Subsection (c) of section 112 of 
    such Code (relating to definitions) is amended by adding at the end 
    the following new paragraph:
        ``(5) The term `maximum enlisted amount' means, for any month, 
    the sum of--
            ``(A) the highest rate of basic pay payable for such month 
        to any enlisted member of the Armed Forces of the United States 
        at the highest pay grade applicable to enlisted members, and
            ``(B) in the case of an officer entitled to special pay 
        under section 310 of title 37, United States Code, for such 
        month, the amount of such special pay payable to such officer 
        for such month.''.
    (e) Effective Date.--
        (1) In general.--Except as provided in paragraph (2), the 
    provisions of and amendments made by this section shall take effect 
    on November 21, 1995.
        (2) Withholding.--Subsection (a)(5) and the amendment made by 
    subsection (c) shall apply to remuneration paid after the date of 
    the enactment of this Act.

SEC. 2. EXTENSION OF INTERNAL REVENUE SERVICE USER FEES.

    Subsection (c) of section 10511 of the Revenue Act of 1987 is 
amended by striking ``October 1, 2000'' and by inserting ``October 1, 
2003''.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.