[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3365 Engrossed Amendment Senate (EAS)]
In the Senate of the United States,
November 3, 2003.
Resolved, That the bill from the House of Representatives (H.R.
3365) entitled ``An Act to amend title 10, United States Code, and the
Internal Revenue Code of 1986 to increase the death gratuity payable
with respect to deceased members of the Armed Forces and to exclude
such gratuity from gross income.'', do pass with the following
AMENDMENTS:
Strike out all after the enacting clause and insert:
SECTION 1. SHORT TITLE, ETC.
(a) Short Title.--This Act may be cited as the ``Military Family
Tax Relief Act of 2003''.
(b) Amendment of 1986 Code.--Except as otherwise expressly
provided, whenever in this Act an amendment or repeal is expressed in
terms of an amendment to, or repeal of, a section or other provision,
the reference shall be considered to be made to a section or other
provision of the Internal Revenue Code of 1986.
(c) Table of Contents.--
Sec. 1. Short title, etc.
TITLE I--IMPROVING TAX EQUITY FOR MILITARY PERSONNEL
Sec. 101. Exclusion of gain from sale of a principal residence by a
member of the uniformed services or the
Foreign Service.
Sec. 102. Treatment of death gratuities payable with respect to
deceased members of the Armed Forces.
Sec. 103. Exclusion for amounts received under Department of Defense
homeowners assistance program.
Sec. 104. Expansion of combat zone filing rules to contingency
operations.
Sec. 105. Modification of membership requirement for exemption from tax
for certain veterans' organizations.
Sec. 106. Clarification of the treatment of certain dependent care
assistance programs.
Sec. 107. Clarification relating to exception from additional tax on
certain distributions from qualified
tuition programs, etc. on account of
attendance at military academy.
Sec. 108. Suspension of tax-exempt status of terrorist organizations.
Sec. 109. Above-the-line deduction for overnight travel expenses of
National Guard and Reserve members.
Sec. 110. Tax relief and assistance for families of Space Shuttle
Columbia heroes.
TITLE II--REVENUE PROVISION
Sec. 201. Extension of customs user fees.
TITLE I--IMPROVING TAX EQUITY FOR MILITARY PERSONNEL
SEC. 101. EXCLUSION OF GAIN FROM SALE OF A PRINCIPAL RESIDENCE BY A
MEMBER OF THE UNIFORMED SERVICES OR THE FOREIGN SERVICE.
(a) In General.--Subsection (d) of section 121 (relating to
exclusion of gain from sale of principal residence) is amended by
redesignating paragraph (9) as paragraph (10) and by inserting after
paragraph (8) the following new paragraph:
``(9) Members of uniformed services and foreign service.--
``(A) In general.--At the election of an individual
with respect to a property, the running of the 5-year
period described in subsections (a) and (c)(1)(B) and
paragraph (7) of this subsection with respect to such
property shall be suspended during any period that such
individual or such individual's spouse is serving on
qualified official extended duty as a member of the
uniformed services or of the Foreign Service of the
United States.
``(B) Maximum period of suspension.--The 5-year
period described in subsection (a) shall not be
extended more than 10 years by reason of subparagraph
(A).
``(C) Qualified official extended duty.--For
purposes of this paragraph--
``(i) In general.--The term `qualified
official extended duty' means any extended duty
while serving at a duty station which is at
least 50 miles from such property or while
residing under Government orders in Government
quarters.
``(ii) Uniformed services.--The term
`uniformed services' has the meaning given such
term by section 101(a)(5) of title 10, United
States Code, as in effect on the date of the
enactment of this paragraph.
``(iii) Foreign service of the united
states.--The term `member of the Foreign
Service of the United States' has the meaning
given the term `member of the Service' by
paragraph (1), (2), (3), (4), or (5) of section
103 of the Foreign Service Act of 1980, as in
effect on the date of the enactment of this
paragraph.
``(iv) Extended duty.--The term `extended
duty' means any period of active duty pursuant
to a call or order to such duty for a period in
excess of 90 days or for an indefinite period.
``(D) Special rules relating to election.--
``(i) Election limited to 1 property at a
time.--An election under subparagraph (A) with
respect to any property may not be made if such
an election is in effect with respect to any
other property.
``(ii) Revocation of election.--An election
under subparagraph (A) may be revoked at any
time.''.
(b) Effective Date; Special Rule.--
(1) Effective date.--The amendments made by this section
shall take effect as if included in the amendments made by
section 312 of the Taxpayer Relief Act of 1997.
(2) Waiver of limitations.--If refund or credit of any
overpayment of tax resulting from the amendments made by this
section is prevented at any time before the close of the 1-year
period beginning on the date of the enactment of this Act by
the operation of any law or rule of law (including res
judicata), such refund or credit may nevertheless be made or
allowed if claim therefor is filed before the close of such
period.
SEC. 102. TREATMENT OF DEATH GRATUITIES PAYABLE WITH RESPECT TO
DECEASED MEMBERS OF THE ARMED FORCES.
(a) Increase in Amount of Death Gratuity.--
(1) In general.--Section 1478(a) of title 10, United States
Code, is amended by striking ``$6,000'' and inserting
``$12,000''.
(2) Effective date.--The amendment made by this subsection
shall take effect as of September 11, 2001, and shall apply
with respect to deaths occurring on or after that date.
(b) Exclusion From Gross Income.--
(1) In general.--Subsection (b)(3) of section 134 (relating
to certain military benefits) is amended by adding at the end
the following new subparagraph:
``(C) Exception for death gratuity adjustments made
by law.--Subparagraph (A) shall not apply to any
adjustment to the amount of death gratuity payable
under chapter 75 of title 10, United States Code, which
is pursuant to a provision of law enacted after
September 9, 1986.''.
(2) Conforming amendment.--Subparagraph (A) of section
134(b)(3) is amended by striking ``subparagraph (B)'' and
inserting ``subparagraphs (B) and (C)''.
(3) Effective date.--The amendments made by this subsection
shall apply with respect to deaths occurring after September
10, 2001.
SEC. 103. EXCLUSION FOR AMOUNTS RECEIVED UNDER DEPARTMENT OF DEFENSE
HOMEOWNERS ASSISTANCE PROGRAM.
(a) In General.--Section 132(a) (relating to the exclusion from
gross income of certain fringe benefits) is amended by striking ``or''
at the end of paragraph (6), by striking the period at the end of
paragraph (7) and inserting ``, or'', and by adding at the end the
following new paragraph:
``(8) qualified military base realignment and closure
fringe.''.
(b) Qualified Military Base Realignment and Closure Fringe.--
Section 132 is amended by redesignating subsection (n) as subsection
(o) and by inserting after subsection (m) the following new subsection:
``(n) Qualified Military Base Realignment and Closure Fringe.--For
purposes of this section--
``(1) In general.--The term `qualified military base
realignment and closure fringe' means 1 or more payments under
the authority of section 1013 of the Demonstration Cities and
Metropolitan Development Act of 1966 (42 U.S.C. 3374) (as in
effect on the date of the enactment of this subsection) to
offset the adverse effects on housing values as a result of a
military base realignment or closure.
``(2) Limitation.--With respect to any property, such term
shall not include any payment referred to in paragraph (1) to
the extent that the sum of all of such payments related to such
property exceeds the maximum amount described in clause (1) of
subsection (c) of such section (as in effect on such date).''.
(c) Effective Date.--The amendments made by this section shall
apply to payments made after the date of the enactment of this Act.
SEC. 104. EXPANSION OF COMBAT ZONE FILING RULES TO CONTINGENCY
OPERATIONS.
(a) In General.--Section 7508(a) (relating to time for performing
certain acts postponed by reason of service in combat zone) is
amended--
(1) by inserting ``, or when deployed outside the United
States away from the individual's permanent duty station while
participating in an operation designated by the Secretary of
Defense as a contingency operation (as defined in section
101(a)(13) of title 10, United States Code) or which became
such a contingency operation by operation of law'' after
``section 112'',
(2) by inserting in the first sentence ``or at any time
during the period of such contingency operation'' after ``for
purposes of such section'',
(3) by inserting ``or operation'' after ``such an area'',
and
(4) by inserting ``or operation'' after ``such area''.
(b) Conforming Amendments.--
(1) Section 7508(d) is amended by inserting ``or
contingency operation'' after ``area''.
(2) The heading for section 7508 is amended by inserting
``or contingency operation'' after ``combat zone''.
(3) The item relating to section 7508 in the table of
sections for chapter 77 is amended by inserting ``or
contingency operation'' after ``combat zone''.
(c) Effective Date.--The amendments made by this section shall
apply to any period for performing an act which has not expired before
the date of the enactment of this Act.
SEC. 105. MODIFICATION OF MEMBERSHIP REQUIREMENT FOR EXEMPTION FROM TAX
FOR CERTAIN VETERANS' ORGANIZATIONS.
(a) In General.--Subparagraph (B) of section 501(c)(19) (relating
to list of exempt organizations) is amended by striking ``or widowers''
and inserting ``, widowers, ancestors, or lineal descendants''.
(b) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after the date of the enactment of
this Act.
SEC. 106. CLARIFICATION OF THE TREATMENT OF CERTAIN DEPENDENT CARE
ASSISTANCE PROGRAMS.
(a) In General.--Section 134(b) (defining qualified military
benefit) is amended by adding at the end the following new paragraph:
``(4) Clarification of certain benefits.--For purposes of
paragraph (1), such term includes any dependent care assistance
program (as in effect on the date of the enactment of this
paragraph) for any individual described in paragraph (1)(A).''.
(b) Conforming Amendments.--
(1) Section 134(b)(3)(A), as amended by section 102, is
amended by inserting ``and paragraph (4)'' after
``subparagraphs (B) and (C)''.
(2) Section 3121(a)(18) is amended by striking ``or 129''
and inserting ``, 129, or 134(b)(4)''.
(3) Section 3306(b)(13) is amended by striking ``or 129''
and inserting ``, 129, or 134(b)(4)''.
(4) Section 3401(a)(18) is amended by striking ``or 129''
and inserting ``, 129, or 134(b)(4)''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2002.
(d) No Inference.--No inference may be drawn from the amendments
made by this section with respect to the tax treatment of any amounts
under the program described in section 134(b)(4) of the Internal
Revenue Code of 1986 (as added by this section) for any taxable year
beginning before January 1, 2003.
SEC. 107. CLARIFICATION RELATING TO EXCEPTION FROM ADDITIONAL TAX ON
CERTAIN DISTRIBUTIONS FROM QUALIFIED TUITION PROGRAMS,
ETC. ON ACCOUNT OF ATTENDANCE AT MILITARY ACADEMY.
(a) In General.--Subparagraph (B) of section 530(d)(4) (relating to
exceptions from additional tax for distributions not used for
educational purposes) is amended by striking ``or'' at the end of
clause (iii), by redesignating clause (iv) as clause (v), and by
inserting after clause (iii) the following new clause:
``(iv) made on account of the attendance of
the designated beneficiary at the United States
Military Academy, the United States Naval
Academy, the United States Air Force Academy,
the United States Coast Guard Academy, or the
United States Merchant Marine Academy, to the
extent that the amount of the payment or
distribution does not exceed the costs of
advanced education (as defined by section
2005(e)(3) of title 10, United States Code, as
in effect on the date of the enactment of this
section) attributable to such attendance, or''.
(b) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2002.
SEC. 108. SUSPENSION OF TAX-EXEMPT STATUS OF TERRORIST ORGANIZATIONS.
(a) In General.--Section 501 (relating to exemption from tax on
corporations, certain trusts, etc.) is amended by redesignating
subsection (p) as subsection (q) and by inserting after subsection (o)
the following new subsection:
``(p) Suspension of Tax-Exempt Status of Terrorist Organizations.--
``(1) In general.--The exemption from tax under subsection
(a) with respect to any organization described in paragraph
(2), and the eligibility of any organization described in
paragraph (2) to apply for recognition of exemption under
subsection (a), shall be suspended during the period described
in paragraph (3).
``(2) Terrorist organizations.--An organization is
described in this paragraph if such organization is designated
or otherwise individually identified--
``(A) under section 212(a)(3)(B)(vi)(II) or 219 of
the Immigration and Nationality Act as a terrorist
organization or foreign terrorist organization,
``(B) in or pursuant to an Executive order which is
related to terrorism and issued under the authority of
the International Emergency Economic Powers Act or
section 5 of the United Nations Participation Act of
1945 for the purpose of imposing on such organization
an economic or other sanction, or
``(C) in or pursuant to an Executive order issued
under the authority of any Federal law if--
``(i) the organization is designated or
otherwise individually identified in or
pursuant to such Executive order as supporting
or engaging in terrorist activity (as defined
in section 212(a)(3)(B) of the Immigration and
Nationality Act) or supporting terrorism (as
defined in section 140(d)(2) of the Foreign
Relations Authorization Act, Fiscal Years 1988
and 1989); and
``(ii) such Executive order refers to this
subsection.
``(3) Period of suspension.--With respect to any
organization described in paragraph (2), the period of
suspension--
``(A) begins on the later of--
``(i) the date of the first publication of
a designation or identification described in
paragraph (2) with respect to such
organization, or
``(ii) the date of the enactment of this
subsection, and
``(B) ends on the first date that all designations
and identifications described in paragraph (2) with
respect to such organization are rescinded pursuant to
the law or Executive order under which such designation
or identification was made.
``(4) Denial of deduction.--No deduction shall be allowed
under any provision of this title, including sections 170,
545(b)(2), 556(b)(2), 642(c), 2055, 2106(a)(2), and 2522, with
respect to any contribution to an organization described in
paragraph (2) during the period described in paragraph (3).
``(5) Denial of administrative or judicial challenge of
suspension or denial of deduction.--Notwithstanding section
7428 or any other provision of law, no organization or other
person may challenge a suspension under paragraph (1), a
designation or identification described in paragraph (2), the
period of suspension described in paragraph (3), or a denial of
a deduction under paragraph (4) in any administrative or
judicial proceeding relating to the Federal tax liability of
such organization or other person.
``(6) Erroneous designation.--
``(A) In general.--If--
``(i) the tax exemption of any organization
described in paragraph (2) is suspended under
paragraph (1),
``(ii) each designation and identification
described in paragraph (2) which has been made
with respect to such organization is determined
to be erroneous pursuant to the law or
Executive order under which such designation or
identification was made, and
``(iii) the erroneous designations and
identifications result in an overpayment of
income tax for any taxable year by such
organization,
credit or refund (with interest) with respect to such
overpayment shall be made.
``(B) Waiver of limitations.--If the credit or
refund of any overpayment of tax described in
subparagraph (A)(iii) is prevented at any time by the
operation of any law or rule of law (including res
judicata), such credit or refund may nevertheless be
allowed or made if the claim therefor is filed before
the close of the 1-year period beginning on the date of
the last determination described in subparagraph
(A)(ii).
``(7) Notice of Suspensions.--If the tax exemption of any
organization is suspended under this subsection, the Internal
Revenue Service shall update the listings of tax-exempt
organizations and shall publish appropriate notice to taxpayers
of such suspension and of the fact that contributions to such
organization are not deductible during the period of such
suspension.''.
(b) Effective Date.--The amendments made by this section shall
apply to designations made before, on, or after the date of the
enactment of this Act.
SEC. 109. ABOVE-THE-LINE DEDUCTION FOR OVERNIGHT TRAVEL EXPENSES OF
NATIONAL GUARD AND RESERVE MEMBERS.
(a) Deduction Allowed.--Section 162 (relating to certain trade or
business expenses) is amended by redesignating subsection (p) as
subsection (q) and inserting after subsection (o) the following new
subsection:
``(p) Treatment of Expenses of Members of Reserve Component of
Armed Forces of the United States.--For purposes of subsection (a)(2),
in the case of an individual who performs services as a member of a
reserve component of the Armed Forces of the United States at any time
during the taxable year, such individual shall be deemed to be away
from home in the pursuit of a trade or business for any period during
which such individual is away from home in connection with such
service.''.
(b) Deduction Allowed Whether or Not Taxpayer Elects To Itemize.--
Section 62(a)(2) (relating to certain trade and business deductions of
employees) is amended by adding at the end the following new
subparagraph:
``(E) Certain expenses of members of reserve
components of the armed forces of the united states.--
The deductions allowed by section 162 which consist of
expenses, determined at a rate not in excess of the
rates for travel expenses (including per diem in lieu
of subsistence) authorized for employees of agencies
under subchapter I of chapter 57 of title 5, United
States Code, paid or incurred by the taxpayer in
connection with the performance of services by such
taxpayer as a member of a reserve component of the
Armed Forces of the United States for any period during
which such individual is more than 100 miles away from
home in connection with such services.''.
(c) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred in taxable years beginning after
December 31, 2002.
SEC. 110. TAX RELIEF AND ASSISTANCE FOR FAMILIES OF SPACE SHUTTLE
COLUMBIA HEROES.
(a) Income Tax Relief.--
(1) In general.--Subsection (d) of section 692 (relating to
income taxes of members of Armed Forces and victims of certain
terrorist attacks on death) is amended by adding at the end the
following new paragraph:
``(5) Relief with respect to astronauts.--The provisions of
this subsection shall apply to any astronaut whose death occurs
in the line of duty, except that paragraph (3)(B) shall be
applied by using the date of the death of the astronaut rather
than September 11, 2001.''.
(2) Conforming amendments.--
(A) Section 5(b)(1) is amended by inserting ``,
astronauts,'' after ``Forces''.
(B) Section 6013(f)(2)(B) is amended by inserting
``, astronauts,'' after ``Forces''.
(3) Clerical amendments.--
(A) The heading of section 692 is amended by
inserting ``, astronauts,'' after ``forces''.
(B) The item relating to section 692 in the table
of sections for part II of subchapter J of chapter 1 is
amended by inserting ``, astronauts,'' after
``Forces''.
(4) Effective date.--The amendments made by this subsection
shall apply with respect to any astronaut whose death occurs
after December 31, 2002.
(b) Death Benefit Relief.--
(1) In general.--Subsection (i) of section 101 (relating to
certain death benefits) is amended by adding at the end the
following new paragraph:
``(4) Relief with respect to astronauts.--The provisions of
this subsection shall apply to any astronaut whose death occurs
in the line of duty.''.
(2) Clerical amendment.--The heading for subsection (i) of
section 101 is amended by inserting ``or Astronauts'' after
``Victims''.
(3) Effective date.--The amendments made by this subsection
shall apply to amounts paid after December 31, 2002, with
respect to deaths occurring after such date.
(c) Estate Tax Relief.--
(1) In general.--Section 2201(b) (defining qualified
decedent) is amended by striking ``and'' at the end of
paragraph (1)(B), by striking the period at the end of
paragraph (2) and inserting ``, and'', and by adding at the end
the following new paragraph:
``(3) any astronaut whose death occurs in the line of
duty.''.
(2) Clerical amendments.--
(A) The heading of section 2201 is amended by
inserting ``, deaths of astronauts,'' after ``forces''.
(B) The item relating to section 2201 in the table
of sections for subchapter C of chapter 11 is amended
by inserting ``, deaths of astronauts,'' after
``Forces''.
(3) Effective date.--The amendments made by this subsection
shall apply to estates of decedents dying after December 31,
2002.
TITLE II--REVENUE PROVISION
SEC. 201. EXTENSION OF CUSTOMS USER FEES.
Section 13031(j)(3) of the Consolidated Omnibus Budget
Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)) is amended by striking
``March 31, 2004'' and inserting ``March 1, 2005''.
Amend the title so as to read: ``An Act to amend title 10,
United States Code, and the Internal Revenue Code of 1986 to
increase the death gratuity payable with respect to deceased
members of the Armed Forces and to exclude such gratuity from
gross income, to provide additional tax relief for members of
the Armed Forces and their families, and for other purposes.''.
Attest:
Secretary.
108th CONGRESS
1st Session
H. R. 3365
_______________________________________________________________________
AMENDMENTS