[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 2942 Introduced in Senate (IS)]







108th CONGRESS
  2d Session
                                S. 2942

 To amend the Internal Revenue Code of 1986 to provide that combat pay 
 be treated as earned income for purposes of the earned income credit.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            October 7, 2004

Mr. Pryor (for himself, Mrs. Lincoln, Mr. Akaka, Mr. Baucus, Mr. Bayh, 
 Mr. Bingaman, Mrs. Boxer, Mr. Breaux, Ms. Cantwell, Mrs. Clinton, Mr. 
Corzine, Mr. Daschle, Mr. Dayton, Mr. Dodd, Mr. Dorgan, Mr. Durbin, Mr. 
  Feingold, Mrs. Feinstein, Mr. Graham of Florida, Mr. Jeffords, Mr. 
  Johnson, Mr. Kennedy, Ms. Landrieu, Mr. Lautenberg, Mr. Leahy, Mr. 
Levin, Mr. Lieberman, Ms. Mikulski, Mr. Miller, Mrs. Murray, Mr. Nelson 
  of Florida, Mr. Nelson of Nebraska, Mr. Reid, Mr. Rockefeller, Mr. 
Sarbanes, Mr. Schumer, and Ms. Stabenow) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to provide that combat pay 
 be treated as earned income for purposes of the earned income credit.

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

SECTION 1. EARNED INCOME INCLUDES COMBAT PAY FOR PURPOSES OF EARNED 
              INCOME CREDIT.

    (a) In General.--Subparagraph (B) of section 32(c)(2) of the 
Internal Revenue Code of 1986 (relating to earned income) is amended--
            (1) by striking ``and'' at the end of clause (iv),
            (2) by striking the period at the end of clause (v) and 
        inserting ``, and'', and
            (3) by adding at the end the following:
                            ``(vi) a taxpayer may elect for any taxable 
                        year to treat amounts excluded from gross 
                        income by reason of section 112 as earned 
                        income.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2005.
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